News Roundup Tuesday 9th April 2019

NEWS ROUNDUP

TAX NEWS

1.75m workers miss out on tax relief

Royal London analysis of figures obtained from HMRC via a freedom of information request suggests that up to 1.75m workers could be missing out on tax relief worth a total of £60m. The issue stems from the fact the threshold for enrolling people in a workplace pension is £10,000, significantly less than the new tax threshold of £12,500. It means that someone paid £12,000 a year automatically loses £528 from their take-home pay in pensions contributions while someone on £15,000 sees their take home pay drop by £510 and gets £240 more added to their pension fund as a result of tax relief.

I, Page: 43 Daily Mirror

‘Europe must take the lead’ on a digital tax, says EU competition chief

EU Competition Commissioner Margrethe Vestager says Europe must put itself in the driving seat regarding a digital tax on technology companies, should a global consensus not be reached. There is currently disagreement over how to implement a GAFA – Google, Apple, Facebook, Amazon – levy to ensure the companies pay their fair share of taxes, with Denmark, Finland, Ireland and Sweden set against proposals from France. “The best thing is a global solution. But if we want to obtain results in a reasonable period of time, Europe must take the lead”, Ms Vestager told the France Inter radio station on Monday.

The Daily Telegraph City AM, Page: 5

MPs call for loan charge review

At least 69 MPs have signed a letter demanding that the Government suspends the loan charge for six months to allow for an independent review, with the All-Party Parliamentary Loan Charge Group telling Financial Secretary to the Treasury Mel Stride: “With the huge anxiety thousands of people are facing, we believe that a pause and a review is vital and the right and responsible thing to do.”

Yorkshire Post, Business, Page: 1

CORPORATE NEWS

Creditors reject Patisserie Valerie plan

Creditors to collapsed café chain Patisserie Valerie have hit its administration by rejecting KPMG’s plan to wind the business down. This means that KPMG must now negotiate a deal with the creditors to proceed, with failure to reach agreement potentially seeing the administrator apply to the court for directions. A person close to KPMG said it was unclear why its proposals had been rejected.

The Times, Page: 38

Debenhams set for pre-pack administration

Debenhams is expected to enter a pre-pack administration after a rescue offer by Sports Direct was rejected. Sports Direct owner Mike Ashley had offered to raise £150m by issuing new shares, which would also have seen lenders write off £148m of the chain’s debt, on the condition that he be made chief executive of Debenhams.

The Daily Telegraph, Business, Page: 1 The Times, Page: 35 Financial Times, Page: 19 The Guardian, Page: 31 Daily Mail, Page: 65 Daily Mirror, Page: 44 Daily Express, Page: 53 City AM, Page: 3 BBC News

Banks face tax dodge lawsuits

Santander has been drawn into a lawsuit over alleged tax avoidance schemes centred on film-financing. The Imagination scheme was part-funded by Alliance & Leicester, which Santander has since acquired. Barclays is facing legal action over a similar scheme. Newport Tax Management, which is managing a class action, said letters will be sent to Santander and Barclays. It also said that, across the financial sector as a whole, compensation claims could hit £11bn.

The Sun, Page: 45 I, Page: 41 City AM, Page: 6 Yorkshire Post, Business, Page: 5

HMRC extends deadline for funding initiative

HMRC and the Treasury have extended the deadline for applications for an £8m Government initiative to help businesses prepare for Brexit from April 5 to 31 May. The funding, which supports customs intermediaries and traders completing customs declarations, can be used toward the costs of employee training and IT improvements. Mel Stride, the Financial Secretary to the Treasury, said: “We have already received over 300 applications, and I’d urge businesses to apply as soon as possible to avoid missing out.”

City AM

SMEs NEWS

Small firms hit by emissions initiative

Small businesses have voiced concern over London’s new ultra-low emission zone, an initiative that will see older models of cars and vans charged £12.50 to enter central London. Sue Terpilowski, the London policy chair of the Federation of Small Businesses, said this could “spell disaster” for many businesses. She said: “The cost of doing business in the capital is already high which is forcing many small businesses to re-evaluate their business activity,” adding: “Small businesses are suffering due to lethal cocktail of increasing business rates, higher employment charges.” Eddie Curzon, London director of the Confederation of British Industry, said smaller firms “can struggle to afford the switch to low-emission vehicles”.

The Independent, Page: 15

LEGAL NEWS

Furniture boss jailed for VAT scam

Anthony Whitehead, the owner of furniture store Warehouse Prestwich, has been jailed for two years and five months over a £150,000 tax scam. Despite the firm seeing sales of £2,229,197, Mr Whitehead paid just £205 in VAT over five years, having lied on his tax return.

Press Release

ECONOMY NEWS

Companies amass record cash balances

Figures from the ONS show that private companies, excluding financial institutions, have stored away £173bn since March 2016 and are now sitting on £747bn of cash, a level not seen before. The ONS said the figures underscore the financial health of Britain’s corporate sector and point to pent-up potential for investment in the economy. The Treasury believes that the balances are proof that there will be a “deal dividend” from better economic growth as companies raise spending if or when the UK leaves the European Union on good terms.

The Times, Page: 41

Retail sales dip

The British Retail Consortium-KPMG monitor showed a “truly disappointing end to the first quarter” for retail sales, with an annual decline of 0.5% recorded in March. Like-for-like growth fell from 0.3% in February to 0.1% in March.

The Times, Page: 41 Financial Times, Page: 3 The Guardian, Page: 32 I, Page: 40 Daily Mirror, Page: 44 Daily Express, Page: 53 The Sun, Page: 45 City AM, Page: 4

Analysis prompts recession fears

OECD indicators designed to predict economic growth over the next six to nine months show that the US, Japan, the eurozone, UK, Canada and Russia are all losing momentum. Ian Stewart, chief economist at Deloitte, comments: “It’s far too early to predict a recession, but it’s not too early to worry about one.”

The Daily Telegraph, Business, Page: 4

OTHER NEWS

600 council staff paid more than the PM

Analysis by the Taxpayers’ Alliance shows that 608 council workers earn more than the Prime Minister’s £150,000 salary, while 2,454 council employees received a remuneration package worth more than £100,000 in 2017/18. This marks the highest total since 2013/14 and is 148 up on the total recorded a year ago. Rob Whiteman of the Chartered Institute of Public Finance and Accountancy, said: “It causes concern to the public to see the number of senior staff, but at local level, these roles are running vital public services.”

The Times, Page: 2 Daily Mail, Page: 16 The Daily Telegraph, Page: 11 Daily Express, Page: 1 City AM, Page: 12

Contact Paul Southward.

Paul Southward