News Roundup Thursday 7th February 2019
Raab: Tax cuts could be a rocket boost for firms
Former Brexit Secretary Dominic Raab says tax cuts could provide the boost needed to see Britain through the “difficult moment” that its exit from the EU may deliver. Praising a cut to corporation tax, Mr Rabb told the Conservative Home website: “There are other tax cuts which sector by sector, and without infringing on state aid rules domestic or international, we could provide businesses, who are undoubtedly feeling a bit uncertain right now, with a bit of confidence.” He added that the Government has yet to publically tell firms what it will do to give them “the rocket boosters” to see them through Brexit. He said rather than being reactive to EU terms or a no-deal scenario, ministers should “get on the front foot and give the public and businesses that reassurance.”
Probate fee ‘stealth tax’ to hurt family businesses
The Institute for Family Business (IFB) trade body has warned that proposed new “stealth tax” probate fees will hurt small business owners. The proposals, which would see estates worth £2m or more pay £6,000 in probate fees, equates to a 3,770% increase on the current flat fee and, in a briefing to the Parliamentary Delegated Legislation Committee, the IFB has urged the Government to rethink its plans. Simon Davis of the Law Society said the cost of administering a grant of probate was the same regardless of the size of your estate and that the changes were not in the public interest.
Pensions tax error
Analysis suggests that HMRC has overtaxed savers by more than £400m by applying emergency tax codes to pension withdrawals. HMRC says it will refund the money by the end of the year, with 174,000 savers overcharged an average of £2,312 each since pensions freedoms began in April 2015.
Daily Mail, Page: 41
Sunrise offers HMV a new dawn
HMV has been sold to a company controlled by Doug Putman, the owner of Sunrise Records in Canada, for an undisclosed sum. The deal will see 100 stores remain open, securing 1,487 jobs, although 455 redundancies will come from the closure of 27 outlets. Will Wright, partner at KPMG and joint administrator of HMV, said: “We are pleased to confirm this sale which, after a complex process, secures the continued trading of the majority of the business.”
The Times, Page: 37 The Daily Telegraph, Page: 8 The Guardian Daily Mail Financial Times, Page: 14 I, Page: 38 The Independent, Page: 58 Daily Express Daily Star Daily Mirror, Page: 16 The Sun, Page: 43 The Scotsman, Page: 17 Yorkshire Post, Page: 9 Evening Standard City AM
Café chain may sue auditor
Patisserie Valerie chairman Luke Johnson has said he is considering suing its former auditor Grant Thornton over the £40m accounting black hole which pushed the cafe chain into administration. Mr Johnson says the chain may have a case against the auditor, which was last week ordered to pay more than £21m in damages to another former client, AssetCo, over negligence.
Daily Mail, Page: 65
Tax claim over tobacco firms
Researchers from the University of Bath say large tobacco companies are paying a “pitiful” amount of corporation tax, with big players shifting their corporate structures to minimise their UK tax bills. George Butterworth, Cancer Research UK’s policy manager, comments: “The tobacco industry is dodging its obligation to contribute to the UK tax system,” adding a call for ministers to impose a tobacco industry levy.
The Independent, Page: 24
Apple settles French tax dispute
Apple has settled a tax dispute with France, agreeing to pay €500m of backdated tax on French-generated income, according to L’Express. Apple declined to comment on the figure but confirmed the settlement.
The Times, Page: 42 Financial Times, Page: 4
Tax changes contributing to private rentals increases
Investors will spend another £36bn on building rental homes by 2025, according to a new study by Knight Frank, to capitalise on growing demand from those who can’t get on the housing ladder. While there are 110,092 rental homes under construction, or being planned in the UK, the estate agent said an extra 560,000 households are expected to be living in the private rented sector by 2023. Nick Pleydell-Bouverie at Knight Frank said buy-to-let tax changes have deterred some smaller players from the market but “large-scale professional private-rented sector landlords are well placed to absorb this.”
SMEs reveal banking concerns
Research from Nationwide Building Society shows that 4 in 10 small businesses only have personal current accounts, rather than a separate business account. It was also found that half of the UK’s SMEs think banks place too much emphasis on making a profit at their expense, while nearly two in three said switching accounts was difficult due to a lack of competition. Firms also voiced concern over branch closures and hikes in fees.
Daily Mirror, Page: 37
Service sector slows
The UK service sector lost momentum in January as incoming new work fell for the first time since July 2016. The purchasing managers’ index (PMI) compiled by IHS Markit and the Chartered Institute of Procurement and Supply fell to 50.3 last month, down from 51.4 in December and from 53.4 a year ago. Howard Archer, adviser to the EY Item Club, said: “Overall, the purchasing managers’ surveys point to very weak UK economic activity in January.”
Mourinho handed sentence and fine over tax fraud
Football manager Jose Mourinho has accepted a one-year prison sentence for tax fraud in Spain, and has been ordered to pay €2m (£1.75m). Mr Mourinho, who failed to declare revenue from image rights from 2011 and 2012 during his time as manager of Real Madrid, will not serve any jail time after agreeing to the fine, with Spanish law saying sentences under two years can be served under probation.
The Daily Telegraph, Page: 5 The Times, Page: 10 The Guardian, Page: 40 Daily Mirror, Page: 51 Daily Mail, Page: 72 The Independent, Page: 67 Daily Star, Page: 7 Daily Express, Page: 55 The Sun, Page: 53 City AM, Page: 6
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