News Roundup Thursday 6th June 2019

NEWS ROUNDUP

TAX NEWS

Corbyn’s spite and envy will strip you of your property rights

Labour’s plans for a progressive property tax based on house prices would be “deeply damaging” for families and pensioners, housing minister James Brokenshire has said. The Conservative Party have calculated the average home would pay £374 a year more than they currently pay in council tax each year. A report led by George Monbiot, called Land for the Many, wants the tax liability to be assessed on the basis of land value, so those with larger gardens would almost certainly be especially penalised. The report also advocates for the state to be able to take over private property and reallocate it elsewhere. Jill Kirby says in the Telegraph that Monbiot and his co-authors “fall back on the old Left wing sentiments of envy and spite.” Labour would remove discounts for single people such as widows living alone and strip away landlord’s rights and effectively hand control of their property to the tenant leading to a collapse in the private rental market. The Mail’s Stephen Glover points out that according to the think-tank MigrationWatch, immigration may account for close to half of all new housing demand, but this is of no interest to Corbynistas: “Their main target is the ordinary middle classes.”

The Daily Telegraph, Business, Page: 2 Daily Express The Sun, Page: 14 Daily Mail, Page: 2, 18

Uber expects hit from transfer pricing probe

Uber’s accounts from 2014 to 2018 are being examined by HMRC for the use of transfer pricing. The taxman is also looking at allegations Uber owes more than £1bn in VAT. Audits are also being conducted by several states in America and by tax authorities in Australia, the Netherlands, Brazil, Australia, Mexico, Singapore and India. In a regulatory filing, Uber said it was “highly uncertain” when the audits would be completed and it was “reasonably possible” that its tax burden could “significantly change in the next 12 months”.

The Times, Page: 45 Financial Times, Page: 14 The Guardian, Page: 19 City AM, Page: 7 The I, Page: 39

Tax all plastics, campaigners urge

Sian Sutherland, co-founder of campaign group A Plastic Planet, has called for all plastic to be taxed and for the government to make businesses accountable for their usage. Speaking at the launch of Nature 2030 last night, she also suggested introducing tax breaks for those trying to create alternative materials and promoting the UK as a pioneering centre for biomaterials. “We must use the power of business to create change, if it doesn’t work for business, it won’t happen,” Sutherland stressed.

Evening Standard

Two million couples miss out on a tax break

Last year, the Treasury claimed three million out of four million eligible couples, who are married or in civil partnerships, were taking up the marriage allowance. However, HMRC now admits only two million make use of the tax break which allows non-taxpaying spouses to transfer 10% of their £12,500 personal allowance to their partners.

Daily Mail, Page: 48

INDUSTRY NEWS

Financial services firms should boost operational resilience

A report from The City UK and PwC says financial services companies need to treat operational resilience as a “commercial imperative”. Those that do “will have a clear commercial advantage and be more sustainable over the long term.” Simon Chard, financial services partner at PwC, said: “Technological advances are a double-edged sword for the industry as consumers and businesses demand more tailored, more efficient and more secure technology.”

City AM, Page: 4

CORPORATE NEWS

Sir Philip agrees £25m deal with UK pensions regulator

Sir Philip Green has won the backing of the Pension Protection Fund for the radical restructuring of his retail empire after agreeing to put an extra £25m in security over property and assets to Arcadia’s pension scheme. The announcement means that the total sum pledged to the retirement fund over the next three years will now increase from £360m to £385m. The PPF is now likely to vote in favour of a company voluntary agreement at a crunch creditor meeting today, leaving the fate of Arcadia in the hands of landlords, almost 200 of whom have been asked to accept big rent cuts. Arcadia and Deloitte, which is supervising the CVA, said that without the restructuring, the group would go into administration.

BBC News The Daily Telegraph, Business, Page: 1 Financial Times The Guardian, Page: 33 The Times, Page: 35 The Sun, Page: 43

Former Crest Nicholson exec new Intu finance boss

Retail operator Intu has appointed ex-Crest Nicholson finance chief Robert Allen, who previously held finance roles at British American Tobacco and Charterhouse Bank, as its new chief financial officer. Interim finance chief Barbara Gibbs will resume her director of finance role.

City AM

SMEs NEWS

FCA clamps down on peer-to-peer investment

People looking to invest into peer-to-peer platforms will no longer be able to put more than 10% of their investable assets into the loans unless they had received regulated financial advice. The new rules announced by the Financial Conduct Authority yesterday also require companies to give better information to customers and test their knowledge and experience of investment if they had not received any advice. Matt Hopkins, head of fintech at BDO, commented: “The tightening of interest rates and the turning of the credit cycle is going to test even more P2P platforms and these reforms will undoubtedly accelerate the managed closure of those unable to comply effectively.”

Financial Times, Page: 18 Daily Mail, Page: 47

Brexit an opportunity for SMEs as M&A deal value plunges

The SME sector outperformed larger firms when it came to mergers and acquisitions in the first quarter of the year. Overall, UK M&A was down 83.7% compared to Q4 last year, with business confidence shaken in the build-up to the March Brexit deadline. ONS data shows deal values fell from £38.8bn to £6.3bn in the first three months of 2019. But Mark Collings, chief commercial officer at Code Investing, said SMEs saw Brexit uncertainty as an opportunity for growth and M&A in the sector fared better than larger corporate firms. Daniel Domberger, partner at Livingstone, added: “M&A volumes are holding up quite nicely in this area as investors look to fulfil long-term strategic goals, and business leaders demonstrate clear growth trajectories.”

City AM, Page: 4

PENSIONS NEWS

Government agrees to NHS pension reforms

The Department of Health and Social Care has agreed to reforms to the NHS pension scheme, following revelations that up to one in 10 doctors could quit under the current system. Senior healthcare staff are increasingly leaving the NHS early to avoid tax bills, in some cases at a rate of 100% on their earnings, triggered because long service means contributions to their final salary pensions breach annual and lifetime limits. A consultation on the so-called “50:50” proposal has been brought forward to begin this month, which would give senior clinicians the option to halve the rate at which their NHS pension grows, in exchange for halving their contributions to the scheme. However the BMA claimed it amounted to an attack on the wages of hard-working doctors and would not stop them leaving.

The Daily Telegraph

Pensioners sent wrong state information since 2016

The Government has apologised and acknowledged significant problems regarding incorrect state pension forecasts, after a third of a million pensioners, around 360,000 individuals who are planning their retirement, were sent the wrong information. Since 2016, online statements were said to have been inconsistent with earlier written statements and, in some cases, new forecasts were more than £1,500 a year higher than had previously been expected.

The Daily Telegraph, Page: 8 Daily Express, Page: 9 Daily Mail, Page: 48 Daily Mirror, Page: 6

ECONOMY NEWS

Construction sector slumps in May

Building activity in the UK dropped in May the third time in four months, according to IHS Markit’s latest survey, resulting in the headcount in the sector to fall at its fastest rate in six-and-a-half years. Duncan Brock at the Chartered Institute of Procurement & Supply, which helps to compile the survey, said: “With the continuing uncertainty around Brexit and instabilities in the UK economy, client indecision affected new orders which fell at their fastest since March 2018 and particularly affected commercial activity,” while Howard Archer of the EY Item Club said it was “particularly worrying to see forward-looking indicators largely weaken.”

Financial Times The Daily Telegraph

World Bank predicts growth will fall to 10-year low

The World Bank has forecast the weakest growth for global trade since the 2009 financial crisis, citing threats from the US-China trade conflict, high government debt and sharp slowdowns in major economies. The Washington-based lender downgraded its forecast for global growth in 2019 by 0.3 percentage points, to 2.6%.

The Daily Telegraph, Business, Page: 8

OTHER NEWS

NHS would not be part of trade deal, insists Trump

Donald Trump told Piers Morgan in an interview that the NHS would not be on the table in a Brexit trade deal. His clarification follows widespread dismay at an earlier suggestion that “everything would be on the table”. But explaining his comments, Mr Trump said: “Somebody asked me a question today and I said everything’s up for negotiation because everything is. But I don’t see that as being… that’s not something that I would consider being part of trade. That’s not trade.” Nigel Farage, the Brexit Party leader, speaking after a meeting with the US president, said it was “wilful misinterpretation” to suggest that a US trade deal would open up the NHS to privatisation. Mr Farage said that the health service could “be knocked off the table” during the negotiation. “If we don’t want the NHS to be part of the deal we won’t sign it,” he said.

The Sun The Times, Page: 6

Contact Paul Southward.

Paul Southward