Furlough extension and a cut in vat rate: Scottish firms’ budget wish list revealed
Scottish SMEs are calling on the Chancellor to announce an extension to the furlough scheme when he delivers his Budget tomorrow, according to the latest data from Bank of Scotland’s Business Barometer research.
When asked which initiative would be most beneficial to helping their firm trade this year, a third (33%) of regional SMEs said an extension to the Coronavirus Job Retention Scheme or the introduction of a new scheme to help them retain employees.
Around on in seven (15%) said they hoped a cut in the VAT rate would be included in the package of measures announced by the Chancellor Rishi Sunak, while more than one in ten (11%) said they would be keen for him to focus on growth policies like staff training grants or business investment tax relief.
Although almost two-fifths (38%) of those polled said they were either ‘very’ or ‘fairly’ optimistic that their firm could trade solvently through 2021 without the support of Government schemes, just over a fifth (23%) were ‘not very’. Almost a third (31%) were undecided, saying they were neither confident nor not confident.
The research also revealed the COVID-19 support measures that Scottish businesses had already made use of during the past year. Just under half (45%) had used the furlough scheme, while a fifth (22%) had accessed Government-backed emergency business funding, for example a Bounce-Back Loan or finance through the Coronavirus Business Interruption Loan Scheme. One in five (18%) had claimed relief on business rates.
Notably, a fifth of respondents (22%) said their business had not needed to access any of the Government’s COVID-19 support schemes so far.
Fraser Sime, regional director at Bank of Scotland Commercial Banking, said: “The announcement of last week’s roadmap out of lockdown has been hugely welcomed by SMEsacross Scotland. However, many still need help to ensure a successful reopening, particularly those in the leisure and hospitality sectors.
“It’s clear that support, including retaining the VAT cut, will help firms rebuild in the coming months as they prepare to reopen their doors and return to business as usual. We remain by the side of Scottish firms and will continue to help as they navigate through the challenges ahead and build back stronger.”