If Britain unlocks fully on July 19th the Government must provide greater flexibility in the repayments of bank loans and defer further business taxes, say leading tax and advisory firm Blick Rothenberg.
Richard Churchill a partner at the firm said: “Not only that but the Government should provide guarantees to insurance companies as it has the banks so that credit insurance limits are not prohibitive to trading. It should also provide financial support to commercial landlords to safeguard their cashflows which would allow greater flexibility in their negotiations with their most badly impacted tenants.”
He added: “The Government needs to continue to support UK businesses by allowing greater flexibility in the repayments of bank borrowings and deferred taxes for viable trading businesses
“It has to provide clarity as to the future fiscal policy to allow businesses to plan It also needs to be clear with the business community as to the plans to deal with further rises in Covid cases and if this will include further lock down measures. This will require support measures to be provided in a targeted manner both by business sector and geographically to ensure a fair playing field for businesses across the country.”
Richard said: “For many businesses the impact of the last 15 months will be felt for many years to come having left both mental and financial scars. The majority of owner managed businesses in the UK have been able to access the support measures offered by UK Government most notably the furlough scheme and underwritten bank borrowing through the CBIL and Bounce Back loan scheme. This has allowed many businesses to survive to this point but now the focus must be on long term growth and a stable business environment.”
He added: “The Government should know that even for those businesses that are performing well there are challenges ahead. The impact of Covid on mobility means there are shortages in the labour market as well as raw materials meaning many job vacancies are unfilled and increasing prices for many businesses.
“Existing support measures come to an end in the next few months, furlough is set to end in September and previous support measures including deferred tax and government supported borrowings need to be repaid. Simply having the cashflow to invest in the future against an uncertain back drop is difficult for many businesses.”
Richard said: “The business environment has changed rapidly and there is still further readjustment to come. Many businesses have depleted their built-up reserves in surviving the pandemic.
He added: “However as they seek to operate at pre pandemic levels they face the challenge of reduced credit insurance limits or difficulties in taking on new leases simply as a result of the reduced balance sheet totals many businesses now have. The end of Covid for many businesses will not happen now or in the near future, they will be dealing with the after effects for years to come. Action is needed by Government to support the businesses that provide an infrastructure to UK business in order they can function effectively.”