News Roundup Monday 21st January 2019

NEWS ROUNDUP

TAX NEWS

Johnson: UK needs ‘most favourable tax environment’

Former foreign secretary Boris Johnson will today say that ministers must “create the most favourable tax environment with no new taxes and no increases in rates” to “stimulate the income we need” for the post-Brexit economy. In a speech at JCB’s headquarters, he will insist that “no-one, rich or poor”, should pay more than 50% of their income in tax – “not because we want to create a tax haven for the rich but because that it is the way to stimulate the income we need to pay for this national programme of cohesion.” Mr Johnson will also suggest that taxes linked to property – such as council tax, stamp duty and business rates – should be “bundled together” and spent locally, giving mayors and local politicians “clear incentives to go for growth”.

The Daily Telegraph, Page: 4 The Times, Page: 7 Daily Mail, Page: 12 The Sun, Page: 2 Daily Express, Page: 4

Probate process goes digital

The Telegraph looks at changes to the probate system which means legal permission to gather up and distribute someone’s assets can be done online. Rachael Griffin of wealth adviser Quilter welcomes the move, saying it “aligns with the Government’s ambition to make tax completely digital and hopefully goes some way to simplifying this complex area.” It comes after an Office for Tax Simplification report into inheritance tax found that bereaved families often faced delays and red tape when winding up a person’s estate.

The Daily Telegraph

Primark finance boss in fair tax call

John Bason, finance chief at Primark owner Associated British Foods, says online firms enjoy an “unfair” tax boost. Looking at the business rates faced by brick and mortar retailers, he said: “Online competitors don’t have that,” adding: “Let’s make sure we don’t have a tax system that is unfairly weighted.”

Daily Mirror, Page: 52

CORPORATE NEWS

Deputy chairman exits Patisserie Valerie

Lee Ginsberg, Patisserie Valerie’s deputy chairman and former head of its audit committee, has resigned with immediate effect. The chain has seen a number of departures from its board since it revealed a £40m hole in its accounts and potential fraud in October. The café chain has hired KPMG to carry out a “review of all options” as it tackles the fallout of the crisis. Meanwhile, the FT reports that shareholders are concerned that the chain could be sold cheaply or put into administration.

The Times, Page: 43 Financial Times, Page: 19 The Independent, Page: 67 The Daily Telegraph, Business, Page: 7 Daily Mail, Page: 73 The Sun, Page: 49 The I, Page: 49 City AM, Page: 3

Sage quarterly sales rise

Sage, which develops accountancy and payroll software for small businesses, saw sales rise 7.6% in the first three months of its fiscal year, as the company moved from a licence-based business to subscriptions. Revenues for the three months increased to £465m, while recurring revenues grew 10.5% as subscriptions to its software rose by 28%.

The Times, Page: 47 The Daily Telegraph Financial Times City AM, Page: 9

UK Government ‘timid’ on gender pay, say MPs

The Business, Energy and Industrial Strategy committee has questioned mandatory reporting on pay, criticising a failure to extend the reporting requirements to partners taking a share of a partnership’s profits but not receiving a salary.

Financial Times, Page: 3

SFO investigates trio of failed building projects

The Serious Fraud Office has opened an investigation into suspected fraud related to three failed property developments, with Moore Stephens, administrator at one of them, “pleased to see an appropriate investigation”.

Financial Times, Page: 19

Hotel seeks buyer

The White Horse Inn in Scotland’s Balmedie is to be marketed for sale after entering administration, with FRP Advisory continuing to trade the business while seeking a buyer.

The Scotsman, Page: 34 The Press and Journal, Page: 31

PROPERTY NEWS

More first-time buyers secure mortgages

November saw 36,200 new first-time buyer mortgages completed, rising 5.8% from the same month in the previous year, according to UK Finance. The £6.0bn of new lending in the month was 9.1% more year-on-year. New buy-to-let loans marked a 9% decline from a year earlier and a 11% drop in value, although buy-to-let remortgaging was up 9.5%. A separate new Bank of England survey shows that lenders are forecasting the demand for mortgages to plummet. The Bank’s gauge of demand for mortgage lending over the next three months fell to -17.5 in the fourth quarter of 2018, dropping from 0.2 in the third quarter and marking its lowest level since the end of 2010. Credit not secured with property also dropped and is expected to fall further up to March.

Daily Mail, Page: 74 Evening Standard The Guardian The Daily Telegraph City AM

SMEs NEWS

Medium-sized firms will not be forced to reveal gender pay gap

The Government has rejected calls to force medium-sized firms to reveal their gender pay gaps. At present, firms with more than 250 employees have to publish figures about their gender pay gap. Responding to a report from the business, energy and industrial strategy committee, which recommended that all companies with more than 50 employees be forced to report their pay gap from 2020, the government said that the threshold to qualify for gender pay gap reporting regulations was consulted on prior to 2017 and that over half of respondents agreed with the 250 threshold.

The Guardian

Entrepreneur: Businesses not wanting Brexit is a myth

Entrepreneur John Longworth, co-chairman of Leave Means Leave, says suggestions that businesses do not want to leave the EU are a myth. He highlights a Federation of Small Businesses poll conducted during the referendum campaign which found that “almost half of its members were determined to leave the EU.” He says that while the business community is split on the issue, it is “privately owned British companies, alongside the risk-taking, innovative entrepreneurs and the multitude of small businesses who most want to leave.” These, he adds, “create employment and are the future.”

The Daily Telegraph, Page: 4

Letter: MDT will not hit SMEs

In a letter to the Telegraph, Theresa Middleton, director of Making Tax Digital at HMRC, refutes a suggestion that SMEs are not digitally sophisticated enough to file tax returns online, insisting that Making Tax Digital will “make a positive difference, reducing the avoidable errors that some businesses make in their tax returns.”

The Daily Telegraph, Page: 17

INTERNATIONAL NEWS

Firms struck off

Australia’s QTR Accountants and Nicoh Group have been struck off over tax refund theft allegations, with around 200 people saying agents had not passed on refunds for the 2017-18 financial year.

The I, Page: 49

ECONOMY NEWS

Credit card borrowing at record low

The Bank of England’s latest credit conditions survey has found that high street banks are forecasting that borrowing on credit cards will decline in the first quarter of 2019 by the most since records began. The BoE said its measure of demand for credit card lending over the three months to the end of March had dropped to -20.7 from -7.2. Howard Archer, chief economic adviser to the EY Item Club, commented: “While the Bank has been keen to see the rate of consumer borrowing slowing, it will not want to see unsecured lending dry up as it will weigh down on economic activity. The Bank ideally wants to see a more sedate rate of borrowing, which has seemingly been happening up until November.”

The Guardian, Page: 35 The Independent, Page: 63 The Times, Page: 40

OTHER NEWS

Barcelona wage bill breaks €500m

A study carried out by KPMG has given an insight to the finances of the champions of Europe’s biggest football leagues. The Football Benchmark report shows that Barcelona have become the first club in world football with an annual wage bill of over €500m, with €562m a year going on wages in 2018, far exceeding the €332m spent by Paris Saint-Germain and Manchester City’s €293m wage bill.

Daily Mirror

Contact Paul Southward if you have any queries.

Paul Southward