Rishi Sunak is set to extend business rates relief and the furlough scheme into the summer, offering further support to companies battered by coronavirus restrictions.
In his Budget next month the chancellor is expected to announce that the year-long business rates holiday for the retail, hospitality and leisure sectors will continue beyond the previous end-date of 31 March.
Sunak will instead issue his final report on a review of business rates, which will consider a potential online sales tax to help boost high-street retailers, in the autumn.
Other support measures, including the furlough scheme, will also be extended into the summer before being phased out.
The extension, first reported by the Financial Times, will come as a fillip to struggling businesses across the country.
Boris Johnson is on Monday expected to announce the first relaxation of lockdown rules, as industries vie to be prioritised for reopening safely.
However, extending the wage subsidy will also complicate attempts by the Treasury to bring government spending back down to more manageable levels.
Sunak’s Budget, scheduled for 3 March, is expected to focus on further emergency support.
Some job support is set to be retained after the furlough scheme ends, while an emergency £20-a-week increase in universal credit is expected to be extended by six months.
The Treasury is also said to be considering tax increases in an effort to balance the books, with the UK’s budget deficit predicted to hit £394bn this financial year.
However, the most significant tax increases are not expected to be tackled until the November Budget, when it is hoped the UK has emerged from lockdowns.