The Chancellor has extended the VAT cut for rural tourism businesses as part of new measures to tackle the economic impact of Covid-19.
Rishi Sunak has extended the VAT cut from 20% to 5% for tourism businesses until 31 March 2021, rather than 13 January.
He said extending the measure would 'help protect 2.4 million jobs through the winter'.
It first came into force in July and was designed keep help tourism and hospitality businesses afloat amid the pandemic.
The Country Land and Business Association (CLA) has been lobbying intensively for the VAT cut – from 20% to 5% - to be made permanent by government.
The rural group said extension would help the sector’s recovery from the first wave, and help weather the storm of the second.
CLA President Mark Bridgeman said: "For UK tourism to succeed in the long term, we will need to ensure we are competitive with other holiday hotspots such as France, Spain and Greece – all charge far lower than 20% VAT.
“Although the peak trade season is over, we want to be clear to the public that rural tourism businesses have gone to great lengths to become Covid-safe, and continue to work hard to ensure a safe and enjoyable holiday.”
The Chancellor also announced a Jobs Support Scheme, which means the government will subsidise the pay of employees who are working fewer than normal hours due to lower demand.
But workers must do at least a third of their normal hours, Mr Sunak explained.
In other announcements, the government will extend the Bounce Back Loans from six years to 10, cutting monthly repayments by nearly half.
Coronavirus Business Interruption Loan Scheme lenders will also be able to extend the length of loans from the current maximum of six years to 10 years.
