Rishi Sunak under pressure for SEISS rules as self-employed face 'catastrophe'

The Chancellor will announce his Budget on Wednesday, leaving many self-employed people eagerly awaiting how they could be impacted. It has already been confirmed that a fourth SEISS grant will be given to independent workers, and Mr Sunak is expected to reveal more details during his announcement. The fourth SEISS grant will cover February to April, but details such as its cap remain unclear. Applications for SEISS 3 closed last month – it covered 80 percent of average monthly trading profits, capped at £7,500 in total.

A key criticism of the scheme has been the many people still excluded from support due to strict rules.

Currently, those who began trading freelance in 2019-2020 are ineligible for support.

The Resolution Foundation recently highlighted that of those self-employed workers claiming a grant, 17 per cent did so despite not losing any income.

At the same time, nearly 80 per cent claimed more than what they had lost out on.

The foundation has estimated the cost of this to be around £1.3bn.

This led a spokesperson from the organisation to claim that SEISS has been “terribly targeted”.

Economist at the Resolution Foundation Hannah Slaughter added: “The Government has provided unprecedented support in response [to the pandemic].

“But it has been terribly targeted – with around £1.3bn going to freelancers and businesses unaffected by the crisis, while others suffering catastrophic income losses have missed out on any support at all.

“This crisis is far from over for the UK’s self-employed workers. Future support should avoid excluding so many groups, while ensuring payments reflect genuine falls in income.”

Between August 17 and October 31, 2020, HMRC received 2.3 million claims for SEISS.

These claims totalled £5.9billion with an average award of £2,500 per claimant.

READ MORE: Sunak slammed for ‘indefensible’ lack of support for self-employed

“Because they have done that, HMRC has the information it needs in order to process those grant payments.”

Mr Chamberlain also warned Mr Sunak against plans to raise taxes on the self-employed, warning this could be the “straw that breaks the camel’s back”.

He added: “People are in an extremely fragile state, and if they have managed to cling on now, the last thing they are going to need is an increased tax burden.

“If we care about our employment rate, if we care about people’s business and if we care about the economy we should not be considering tax rises right now.”

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