News Roundup Tuesday 18th September 2018

NEWS ROUNDUP

TAX NEWS

No deal would be opportunity for ‘tax incentives’, says Javid

The Home Secretary reportedly called last week for a no-deal Brexit to be used as an opportunity to introduce new “tax incentives” to boost the economy. Sajid Javid’s comments during a Cabinet meeting will be seen as a rebuke of Philip Hammond’s insistence the Treasury could not afford tax cuts, the Sunday Telegraph suggests, while EU leaders will be alarmed at the idea the UK will transform into a low-tax economy luring business away from the Continent.

The Sunday Telegraph, Page: 1, 6-7

NCA left frustrated by Cayman Islands

The National Crime Agency has complained of a lack of co-operation by the authorities in the Cayman Islands as the UK steps up its fight against dirty money. Donald Toon, director of the NCA, revealed the Cayman Islands authorities had not co-operated when he had asked for information on who owned offshore firms registered in the territory. Mr Toon also said there were now signs that criminals were finding new tax havens where they could exploit lax regulation and hide their links to corrupt assets. He added that, in the UK, there were “a couple of dozen” active investigations into lawyers and accountants suspected of facilitating the flow of dirty money into the country which he described as the “lifeblood of nearly all organised crime”.

BBC News

HMRC must pursue all equally

In a letter to the Sunday Times, Dame Margaret Hodge says HMRC’s admission that it lets celebrities avoid prosecution so they can protect their reputations is an affront to “the British tenet that we all are equal before the law.” She says: “It is time we lifted the veil of secrecy that surrounds HMRC, so that we hold it to account and know that everyone pays their fair share of tax.” Her comments are in response claims published last week. Penny Ciniewicz, the director-general at HMRC’s Customer Compliance Group, refutes the allegations in a letter of her own to the same paper.

The Sunday Times, Page: 22

MEP rejects Juncker’s call for change to EU voting rules on tax

Irish MEP Brian Hayes has demanded that Jean-Claude Juncker’s call for unanimous voting on EU tax matters to be scrapped in favour of majority voting be blocked. “The European Council currently votes on tax matters by way of unanimity, thus allowing any country big or small to veto an EU tax proposal,” he said, adding: “Juncker’s suggestion of changing this to qualified majority voting would suit big Member States but would side-line small Member States like Ireland.”

Sunday Express

France waters down its ‘exit tax’

Emmanuel Macron has postponed the abolition of France’s “exit tax” on capital gains and instead introduced a new “anti-abuse” tax targeted at assets sold within two years of someone leaving the country.

Financial Times

PROPERTY NEWS

Money launderers target weak agents

The Independent’s Ben Chapman reports on how criminals are targeting university towns to buy property and launder money because local agents are often less alert to laundering risks and the market is relatively stable. Mark Hayward, chief executive of NAEA Propertymark, says thousands of estate agents operate without proper oversight. Analysis of Companies’ House records by Moore Stephens found there were 25,560 estate agent businesses in July last year, yet only 11,318 are registered with HMRC for anti-money laundering purposes.

The Independent, Page: 14

LendInvest secures backing

Online property platform LendInvest has received £31m in debt and equity funding from backers including Atomico, the fund set up by Skype founder Niklas Zennstrom, and the technology investment bank GP Bullhound. LendInvest matches investors and borrowers in the property finance market.

The Sunday Times, Business, Page: 2

Department stores bailing out

Just over 27% of department stores in England and Wales have been lost since 2010, according to research from business rates and tax specialist Altus Group, as they struggle to cope with high rents, rising business rates and competition from online rivals.

Sunday Express, Page: 53

CORPORATE NEWS

Green’s finance chief departs

Paul Budge has quit as finance director at Arcadia. Budge, a long-serving aide to Sir Philip Green, became finance director of BHS in 2009 and was closely involved in its sale to serial bankrupt Dominic Chappell in 2015. The Mail notes that his departure follows criticism by the Financial Reporting Council of PwC‘s audit of the BHS accounts in 2014. Arcadia financial controller Gillian Hague has been appointed acting group finance director.

The Sunday Times, Business, Page: 3 The Mail on Sunday, Page: 58

SMEs NEWS

MPs demand probe into HBOS coverup

The All Party Parliamentary Group on Fair Business Banking has asked police in Scotland to launch a criminal investigation to examine an alleged fraud cover-up at HBOS Reading. An internal Lloyds report in 2013 claimed bosses knew about the fraud ahead of the takeover of HBOS by Lloyds in 2009.

The Mail on Sunday, Page: 58

ECONOMY NEWS

Gloom over UK economy unwarranted

Liam Halligan says in the Sunday Telegraph that claims that the UK‘s growth rate is the lowest in the G7 are untrue. UK GDP growth will be around 1.5% in 2018, on official estimates, putting the UK well ahead of Italy and Japan, he states. Halligan points out that the ECB and the Bank of Japan continue with money printing while the Bank of England stopped its QE some time ago, so the UK is not propped up in the same way. Continued doom-mongering over a no-deal Brexit is also misplaced, he adds, reminding readers that the UK trades under WTO rules “with the US, China and nations making up most of the 80%-plus of the world economy lying beyond the EU’s shores”.

The Sunday Telegraph, Business, Page: 2

Investors rewarded with record payouts

Research by AJ Bell shows Britain’s biggest firms are on course to pay a record £88.6bn in dividends this year, rising to £92.7bn in 2019, despite many struggling to generate extra profits. Dividends are up 81% since 2007 while profits have risen by only 46%. AJ Bell investment director Russ Mould says investors are putting pressure on FTSE 100 companies to reward them after a couple of years of low growth. Others point to the weak pound as a reason for the hike in dividends as many FTSE100 companies report in dollars.

The Mail on Sunday, Page: 58

PERSONAL FINANCE NEWS

Credit firms warn loans could dry up

The Consumer Credit Trade Association has claimed its members have been “carpet bombed” with compensation demands from claims management companies (CMCs). CEO Greg Stevens says the “unfair” targeting risks increasing costs for lenders, reducing the number of loans available to consumers, and increasing charges for those loans.

BBC News

REPORTING NEWS

Carilion’s accounts revealed its doom

Fund manager Tim Steer explains in the Sunday Times how he spotted clues in Carillion’s annual reports that revealed a looming disaster. Steer has written a book called The Signs Were There: The Clues for Investors That a Company is Heading for a Fall.

The Sunday Times, Business, Page: 6

OTHER NEWS

BoE governor: New industrial revolution may end retirement

Bank of England governor Mark Carney has warned that increased automation would lead to a ‘Fourth Industrial Revolution’ that could see retirement become a thing of the past. Speaking at the Central Bank in Dublin he said, “the more rapid pace of adjustment and longer working lives means workers may not have the option of retiring”. He also suggested automation threatens one in ten UK jobs, with the “threat of robot substitutes” likely to weaken bargaining powers with employers. He added that revolutionising work practices would boost productivity and wages and create jobs. Brexit, he argues, has been bad for wage growth as uncertainty has delivered an “additional dampening effect”.

The Sunday Times Sunday Express The Sun

Contact Paul Southward if you have any queries.

Paul Southward