News Roundup 3rd June 2018

NEWS ROUNDUP

TAX NEWS

Tax crackdown focus shifts to UK firms

Research by Pinsent Masons suggests HMRC is increasingly switching the spotlight of its investigations away from suspected underpaid tax by foreign companies on to UK concerns instead. Data from the Revenue shows it is targeting foreign businesses for just 34% of all suspected underpaid tax – compared with 39% five years ago. By contrast, UK companies are now targeted for 66% of all suspected underpaid tax, up from 61% in 2012. The report also reveals that over the past five years the amount of tax HMRC suspects UK businesses of underpaying has risen 36% to £16.4bn, compared with £12.1bn in 2012. HMRC suspects foreign businesses of £8.4bn in tax underpayments, up just 9% from £7.7bn five years ago.

The Scotsman, Page: 33

Latest Tax Freedom Day for 20 years

Today marks the latest ‘Tax Freedom Day’ for two decades, according to the Adam Smith Institute. The think-tank found British taxpayers have effectively worked 148 days to cover their tax bills in 2018 – three days more than in 2017. Figures from the Office for Budget Responsibility show HMRC will collect £724.9bn this year, equivalent to 34.3% of national income. The last time the tax burden was higher as a proportion of GDP was in 1969-70.

The Daily Telegraph, Page: 6 Daily Mail, Page: 2 Daily Express, Page: 12 The Sun, Page: 2

Payback deadline looms for former Rangers stars

Former Rangers stars who benefited from a tax avoidance scheme must come up with a payback plan within days – or face legal action. HMRC is trying to recoup millions of pounds from Employee Benefits Trusts which were operated by the Ibrox side, and has set a deadline of this Thursday to open up negotiations on a settlement deal.

Daily Record

NHS tax plans risk fuelling public backlash, report warns

The King’s Fund says a hypothecated tax to fund the NHS could fuel public mistrust in politicians by failing to deliver consistently higher public expenditure on health and social care.

Financial Times, Page: 3

Tories call for tech tax to save high Street

MPs have urged Philip Hammond to fast-track a 3% sales tax on the likes of Amazon, eBay and Google and use the money raised to help Britain’s ailing high streets.

The Sun, Page: 2

INDUSTRY NEWS

Big Four brought to book

The Times continues its serialisation of The Big Four, The Curious Past and Perilous Future of the Global Accounting Monopoly by Ian D Gow and Stuart Kells. Today’s extract focuses on whether too much is expected of accounting firms. Elsewhere, the Guardian publishes an extract from Bean Counters: The Triumph of the Accountants and How They Broke Capitalism by Richard Brooks. The author argues that the early 21st-century financial crisis was partly caused by the “demise of sound accounting.”

The Times, Page: 39 The Guardian, Journal, Page: 9-11

Bad debts taking lighter toll

Businesses have reported fewer losses from bad debts in the past 12 months. The findings by Intrum show UK companies on average wrote off 2% of their annual revenue owing to non-payment of debts, down from 4.7% the year before. The survey also found that 24% of British firms cited late payment as a threat to survival, much higher than the European average of 10%.

The Times

SMEs NEWS

 Law firm facing inquiry over RBS review

Law firm Clifford Chance is facing an investigation from the Solicitors Regulation Authority after a complaint that it overlooked an allegation of fraud during a review of Royal Bank of Scotland’s treatment of thousands of small companies. A small business owner has accused the firm of failing to act on detailed evidence that he had provided which he believes shows that RBS abused a taxpayer-backed loan scheme.

The Times, Page: 33-35

PROPERTY NEWS

Mum and Dad bankroll a quarter of all house sales

More than one in four transactions this year are expected to depend on the Bank of Mum and Dad. Parents will contribute £5.7bn to help their adult children to buy homes in 2018, according to Legal & General. That cash will fund almost £82bn of property purchases, or about 315,000 transactions.

The Times, Page: 34-35 I, Page: 9

ECONOMY NEWS

Drones could boost UK economy

According to PwC, drones could help to boost Britain’s economy by £42bn by 2030 as businesses start to use the devices to collect data and improve productivity. PwC believes that there will be more than 76,000 drones in Britain’s skies in just over a decade, with around a third of them expected to be controlled by the public sector. PwC’s Elaine Whyte said: “The advantages of drone technology will be not only for business purposes, but for helping to protect our society, for example, through being used by emergency services.” PwC added that retail and wholesale trade, agriculture, manufacturing and construction companies also will benefit from productivity gains as a result of using drones.

ITV News The Times, Page: 38 Daily Mail, Page: 60 The Guardian, Page: 32 Daily Express, Page: 47

Time to raise rates

PwC ’s Andrew Sentance says the time has come for the UK to raise interest rates. He notes that the present level of interest rates was put in place in 2009 to deal with a financial emergency, but that this emergency “disappeared a long time ago.”

The Times

INTERNATIONAL  NEWS

Deloitte partner to be Myanmar finance minister

A managing partner at Deloitte has been nominated as Myanmar’s next finance minister. Soe Win’s appointment is expected to be confirmed this week.

City AM, Page: 16

OTHER NEWS 

Man Utd most valuable club in Europe

Manchester United has been crowned the most valuable European football club, with an enterprise value (EV) of €3.25m, according to research by KPMG. The club took top spot ahead of Real Madrid, which scored an EV of €2.92m, and Barcelona, which had an EV of €2.78m.

Accountancy Daily

HMRC headcount falls by 2,000

MPs have voiced concerns about Britain’s preparations to implement a new customs regime after Brexit, after it emerged that HMRC is employing 2,000 fewer staff than on the day of the EU referendum.

The Times, Page: 8

Peak Prosecco?

A report by UHY Hacker Young suggests Britain has reached “peak prosecco”, with last year accounting for the smallest rise in sales of the drink since 2011.

The Daily Telegraph, Page: 9 Daily Star, Page: 16

 Contact Paul Southward if you have any queries.

Paul Southward