News Roundup Tuesday 14th May 2019

NEWS ROUNDUP

TAX NEWS

Britain’s 1,000 richest must publish tax returns, says Corbyn

Just as the Sunday Times published its annual Rich List, the leader of the Labour party, Jeremy Corbyn, has demanded that Britain’s wealthiest people publish where and how much taxes they’ve paid. He said the Rich List shows “grotesque inequality that scars our society” as their total wealth almost outstrips an entire year’s spending by the government. Mr Corbyn said: “Year on year, we see the rich getting richer, while pay for the majority hasn’t risen in a decade and household debt rises. In the interest of transparency, everyone on the list should publish where they are registered to pay tax and how much tax they have paid. Labour will reprogram our economy, so it stops just supporting a tiny few at the top, and starts to reward the many, who do the work, create the wealth, and pay their taxes.” His comments coincide with reports that Britain’s richest people would leave the country if Mr Corbyn wins power, t aking £1trn out of the economy.

Daily Mirror, Page: 11 The Sun, Page: 14 Daily Mail, Page: 12 The Times, Page: 12

UBI will require unacceptably high taxes

John McDonnell has said Labour will trial universal basic income (UBI) if it wins power in the next general election. Responding to the plans, John Kay, former director of the Institute for Fiscal Studies, said: “If you do the numbers, either the basic income is unrealistically low, or the tax rate to finance it is unacceptably high. End of story.”

The Independent

The Brexit effect: private equity firms shun UK for Europe

The FT reports on how attractive tax regimes on the continent combined with Brexit and the threat of Jeremy Corbyn is leading some buyout groups to consider shifting operations to Europe.

Financial Times, Page: 19

UK will have world’s first plastic tax

The Treasury has announced that the UK will be the first country in the world to introduce a plastic tax. The levy will hit plastic manufacturers that fail to include 30% recycled content.

Daily Mail, Page: 14

PROPERTY NEWS

Dave Lewis: Reform rates or watch high street die

Tesco boss Dave Lewis is calling for a 2% sales tax to be levied on internet retailers to pay for a 20% cut in business rates for the high street. In a piece for the Mail, Mr Lewis said: “Billions of pounds have shifted online, but the rates system was never devised to account for this. Because the bill is linked to property – not profit – shops struggling to keep the doors open have to pay up, while larger online businesses pay just a fraction.” Lewis concludes: “As I see it, there are only two choices. We can prolong the status quo, losing jobs and business and impacting communities. Or we can put our tax system back in step with sales. That would level the playing field, reduce the unsustainable burden of rates and increase investment – for the good of retail, and our great nation of shopkeepers.”

Daily Mail, Page: 1, 4

Landlords profit by abandoning buy-to-let

Research by Hamptons International shows buy-to-let landlords who are leaving the market because of a government clampdown have been making an average profit of £80,000 for each property sold. In England and Wales, landlords made £79,770 before tax last year, having owned the property for an average of just over nine and a half years. However, the average gain was still £3,660 less than the £83,430 that landlords made in 2017.

The Times, Page: 38

CORPORATE NEWS

Metro Bank explores sale of loans hit by accounting error

Metro Bank is considering the sale of more than £1bn worth of loans affected by a misreporting scandal that caused its share price to plunge and forced it into a rights issue. The accounting error related to large numbers of commercial property and professional buy-to-let loans; Metro found it did not have as much capital against them as it should have done as a result of the mistake

Financial Times, Page: 1 BBC News The Times, Page: 35 The Guardian, Page: 35

Ex-Autonomy director faces nine years

The former finance director of Autonomy, Sushovan Hussain, will be sentenced today in San Francisco a year after he was found guilty of fraud. He was judged to have fraudulently inflated Autonomy’s revenues in the run-up to the $11bn takeover of the British software company by Hewlett Packard in 2011. In an order released last week ahead of sentencing, the court recommended that Mr Hussain face between seven and nine years in jail.

The Daily Telegraph

EMPLOYMENT NEWS

Number of businesses planning to hire increases

The quarterly survey of employers by the Chartered Institute of Personnel and Development (CIPD) has found a higher proportion of businesses plan to increase staff levels compared with three months ago. Confidence is highest in business services, construction, healthcare and information technology. However, two in five employers say it has become harder to retain staff, with a majority increasing salaries in response to recruitment and retention challenges. Despite this, overall pay rise expectations are down slightly in the private sector from 2.5% to 2%. The public sector has seen a rise from 1% to 1.5%.

The Times, Page: 35

ECONOMY NEWS

Brexit confusion harming business confidence

A survey by BDO has found business confidence in April remained at its lowest level since 2012. Activity in the manufacturing sector, which has been boosted by stockpiling activity, is expected to diminish while optimism in the UK’s services sector fell for a ninth consecutive month. Peter Hemington, partner at BDO, said: “The only certainty businesses have at the moment is that the UK government still doesn’t know exactly how or when the UK will leave the EU. We are seeing the impact of this confusion, with business confidence plummeting.”

The Times, Page: 35

BoE warns of Brexit impact on investment

Bank of England deputy governor Ben Broadbent has warned about the damaging impact of further Brexit delays. He said business investment has already been “feeling the consequences” and cautioned that delaying Brexit further means prolonging the uncertainty for companies and risks hitting the wider economy.

The I, Page: 6 The Guardian

REGULATION NEWS

Crypto hedge funds live to fight another day

In a piece on crypto hedge funds, the FT notes that regulators worldwide are stepping up their scrutiny of cryptocurrencies and blockchain as more established financial players adopt the technology.

Financial Times

OTHER NEWS

Johnson: Only One Nation Conservatism can provide for the NHS

Boris Johnson has said more cash will be available for the NHS when Britain stops paying into the EU budget, and warned that the “predatory socialism” advocated by Jeremy Corbyn and John McDonnell will not deliver the cash we will need. He added: “It cannot be repeated too often that by renationalising everything from water to post to rail, and by taking a 10% state ownership of all companies of a certain size, and by imposing such swingeing taxation that people are already preparing to flee the country, the Momentum-driven Labour Party would bankrupt the economy.”

The Daily Telegraph Daily Express

Contact Paul Southward.

Paul Southward