News Roundup Saturday 27th April 2019

NEWS ROUNDUP

TAX NEWS

Labour’s £3bn tax on rich to pay for dementia care

Labour will raise taxes on the top 5% of earners to help fund £3bn of spending on caring for dementia sufferers at home. The party said that the extra spending would be funded by raising income tax rates to 45% for those earning more than £80,000 and to 50% for those earning more than £125,000. It would also increase tax on private medical insurance.

Daily Mail, Page: 25 The Times, Page: 14

Bereaved families hit with bumper IHT bill

The taxman collected an extra £164m in inheritance tax (IHT) in the 2018-19 financial year, according to analysis of HMRC receipts by NFU Mutual, an increase of 3.1% and a total sum for the 12 months of £5.369bn. Sean McCann, chartered financial planner at NFU Mutual, said this marks the biggest surge since 2017, adding: “Recent changes have just added to the problem and in many instances the complexity of the rules means that families are missing out.”

Daily Express

Fee-paying schools save taxpayers billions

Private schools contribute £4.1bn to the Treasury in tax each year and save the taxpayer a further £20bn a year by educating pupils who would otherwise need state places. The figures are revealed in a report from the heads of fee-paying schools as they defend themselves against Labour plans to put VAT on school fees to fund free state primary school meals. Conservative threats to end charitable status for private schools have been abandoned.

The Times, Page: 1, 6 The Sun, Page: 2

Emmanuel Macron promises tax cuts in new round of French reforms

The President of France has promised €5bn worth of cuts in personal income tax and a return to inflation-indexing for pensions in response to the gilets jaunes protests. Emmanuel Macron also said there would be cuts to public spending but added that the French needed to work more – like its “neighbours”.

Financial Times, Page: 4 The Daily Telegraph, Page: 13 The Times, Page: 27 The Guardian, Page: 26

SMEs NEWS

£60bn in sales at risk from new fraud checks

The Federation of Small Businesses has joined the Institute of Directors and the British Retail Consortium in questioning the wisdom of new anti-fraud rules which industry groups fear will make it impossible to process online transactions. Purchases worth more than £30 will require “two-factor authentication” from mid-September but retailers fear £60bn of sales via cards online could be lost due to a lack of preparation for the change. “Rolling out the system before businesses and shoppers are prepared for it will be bad for all concerned. We’re a few months from enforcement and hardly anyone has even heard of it,” said Mike Cherry, chairman of the FSB.

The Daily Telegraph, Business, Page: 1

Employers demand apprenticeship levy reforms

A survey by the Federation of Small Businesses has found that over a quarter of employers find the apprenticeship levy has had a negative impact on their business, that the system is too inflexible and needs to be reformed. In total, 27% of employers that took on apprentices both before and after the levy was introduced in 2017 said the changes had had an adverse impact on their business. More than 40% found the hiring process too difficult, with a similar number reporting that hiring and training costs had increased. Almost 29% said it took up too much managerial time.

The Times, Page: 34

PROPERTY NEWS

Average deposit for first-time buyers now at £31k

First-time buyers looking to get onto the property now require an average house deposit of £30,989 following an increase of 12% in 2018, Experian figures have revealed. House prices rose across Britain rose just 2.5% over the same period, data from the Office for National Statistics shows, suggesting first-time buyers might be struggling to access the 5% deposit deals that are the most common way onto the property ladder. Previous Experian research supports this, as 22% of would-be homebuyers said finding a deposit was the largest obstacle to owning a home.

The Daily Telegraph

Peers call for stamp duty reform

A House of Lords committee report has called for the reform of stamp duty, which it says has “seriously distorted the housing market”. The committee on intergenerational fairness also recommended local authorities be permitted to develop unused land owned by public sector bodies and give them greater freedom to borrow

Mortgage Strategy

CORPORATE NEWS

Brexit blamed for rise in Scottish firms going bust

Uncertainty over Brexit has been blamed for the steep rise in corporate insolvencies (280) in Scotland, according to data from Accountant in Bankruptcy, a leap of 34% in the first three months of this year. Eileen Blackburn, head of restructuring and debt advisory at French Duncan, cautioned: “The trend for corporate failures has been rising steadily for six years and shows little signs of slowing.” Overall, there were 966 corporate insolvencies in 2018-19, up from 884.

Insider

PENSIONS NEWS

Senior NHS doctors warn over pension tax rules

Without reform to pension tax rules senior NHS doctors will reduce their hours on an “unprecedented scale”, “seriously impacting” patient care in the UK, the British Medical Association has warned.

Financial Times, Page: 3

ECONOMY NEWS

PE investment boosts business revenue by over 50%

Businesses backed by private equity saw revenue soar by more than half in the last five years with PE-backed companies enjoying a growth rate of 10% in the last financial year alone, according to analysis of 2,000 firms by BDO. Jamie Austin, head of private equity at the firm, said: “The figures speak for themselves. Businesses that have the backing of private equity investors are driving growth and creating jobs against a backdrop of uncertainty and the UK economy would suffer without them.”

City AM

UK economy is “remarkably resilient”

Speaking at the bank’s AGM, RBS chairman Sir Howard Davies said that the UK economy has proved “remarkably resilient” but that a lack of clarity over Brexit was dampening consumer confidence and business investment.

Sky News The Independent, Page: 61

OTHER NEWS

Kpedekpo appointed to SFA board

Former KPMG accountant and Aberdeen forward Malcolm Kpedekpo has been appointed to the board of the Scottish FA as an independent nonexecutive director.

The Press and Journal, Page: 57 The Scotsman, Page: 59

Contact Paul Southward.

Paul Southward