Counting the cost of England’s floods
Tax concessions and insurance payouts will go some way towards easing the heartbreak of those whose homes and businesses have been flooded in the worst weather for more than half a century, but how much will the crisis cost UK plc?
The Chancellor, Alistair Darling, a series of tax measures for individuals and businesses affected by the recent severe flooding whilst Gordon Brown has revealed a £14m package to help get the worst-affected areas back on their feet.
Meanwhile the insurance industry is painting a bleak picture with estimates of the final bill ranging from £1.5bn to £3bn.
Weather related claims usually see the industry paying out around £1bn each year.
The Government will bring forward legislation in next year’s Finance Bill which will allow the Commissioners of HM Revenue and Customs to waive interest and surcharges on tax paid late due to the floods.
While the taxman will, eventually, want to be paid his dues in full, Government has said it will understand if payments are delayed.
Financial Secretary to the Treasury and Minister for HMRC, Jane Kennedy said, “I want to ensure that people affected by the flooding do not have to worry about tax or their tax credit award at this difficult time.
“Where individuals or businesses are affected by the flooding, I would ask them to get in touch with HMRC who will be able to offer practical help. I hope that, by offering this help now and the reassurance that HMRC will back-date their help, we can ease some of the anxiety that is affecting so many people and business. ”
Paul Gray, Chairman of HMRC added, “We know that the recent floods have affected a large number of our customers and we want to make it easy for them to meet their obligations to HMRC and receive their tax credits. Our staff are standing by ready to help.”
The Prime Minister’s payout will see local authorities receive £10m, a £1m contingency fund to help families buy essential household items and a further £3m to be spent on bridge and road repairs.
Meanwhile, those attempting to make insurance claims might face delayed payouts as the inundated industry deals with a huge increase in the number of calls.
Nick Starling, the ABI’s Director of General Insurance and Health, said:
“Insurers already have emergency plans in place to deal with these floods, and will pull out all the stops to help policyholders.
“Their main priority is to arrange emergency repairs, get people into temporary accommodation where needed and visit properties as soon as they can.”
© Faversham House Ltd 2022 edie news articles may be copied or forwarded for individual use only. No other reproduction or distribution is permitted without prior written consent.