NEWS – THURSDAY 24TH SEPTEMBER 2020

NEWS ROUNDUP

TAX / EMPLOYMENT – EMERGENCY COVID-19 MEASURES

Rishi to unveil emergency jobs scheme

The chancellor is expected to announce new measures to replace the furlough scheme which expires next month.  It is also expected that the VAT temporary reduction will be extended.  Don’t forget to check back here after the announcements have been made.

TAX NEWS – THURSDAY 24TH SEPTEMBER 2020

Tax tech firms thriving on pandemic, say campaigners

The Independent looks at some of the companies that have thrived during the lockdown, particularly Amazon, Apple, Microsoft and videoconferencing company Zoom. The paper cites Robert Palmer, director of Tax Justice UK, who says these companies also pay less tax than businesses with a physical retail presence and calls on the Government to hit the tech firms with a windfall tax to help the country rebuild after the pandemic. In the longer term, he says the Government should rebalance the tax system by increasing corporation tax above its current level and crack down on corporate tax avoidance. “Polling shows increasing taxes on multinationals would be really popular with voters, including Conservative voters,” says Palmer. “I think there’s a feeling in the business community too that it is important for firms to pay back and contribute.”

The Independent, Page: 44

Majority back tax rises to pay for Covid

A poll by the think tank Demos has found that 58% of the public would back increasing income tax for everyone by 2p in the pound to help pay for the coronavirus crisis, while raising the personal allowance to £20,000. Just 37% of respondents supported the idea of a 1p in the pound rise for everyone while 69% of people would support raising income tax on earnings over £100,000 per year by 10p in the pound.

Yorkshire Post, Page: 5

CORPORATE NEWS – THURSDAY 24TH SEPTEMBER 2020

City of London abandons plans for widespread return to office

A raft of City companies have halted plans to bring staff back into the office. Thousands of staff at firms such as JPMorgan and PwC who had been brought back will now revert to working from home after Boris Johnson reversed guidance on returning to offices. The FT’s Lombard says the City of London risks being permanently damaged by the atomisation that comes with coronavirus restrictions. The Times cites Catherine McGuinness, policy chairwoman of the City of London Corporation, who comments: “We are disappointed at the blanket call for office workers to return to working from home where possible. Firms have taken huge steps to make sure that their offices are Covid-secure. It’s clear that this virus isn’t going to go away quickly so we need to find a way of living with it that doesn’t cripple our economy.”

Financial Times, Page: 11 Financial Times The Times, Page: 7

Pendragon delays results

Pendragon has delayed publishing its interim results less than 24 hours before they were due to be issued. The car dealer said the hold-up was requested by auditors KPMG as extra reviews are needed due to the pandemic.

The Daily Telegraph, Business, Page: 7 The Times, Page: 42

PENSIONS NEWS – THURSDAY 24TH SEPTEMBER 2020

Government confirms it will maintain triple lock

The Government has confirmed it will maintain the triple lock and increase the state pension in 2021-22 despite speculation that it might be scrapped due to COVID-19. Legislation was tabled yesterday to avoid the state pension being frozen in April because of the fall in average earnings. Rishi Sunak has been pushing for the triple lock to be suspended for fear of soaring costs because of the recession and a fall in wages caused by the furlough scheme, which covers 80% of earnings. Ian Browne, a pensions expert at Quilter, said that the triple lock could lead to “intergenerational unfairness” as wages fall and pension incomes rise.

International Adviser FT Adviser The Daily Telegraph The Times, Page: 4

SMEs NEWS – THURSDAY 24TH SEPTEMBER 2020

Watchdog urged to force insurer to pay firms hit by Covid

The Financial Conduct Authority is being urged to use its enforcement powers against Hiscox to force the company to start making payouts to small businesses hit by the pandemic. Lawyers acting for almost 400 firms want the insurer to start making interim payments after a High Court judgment last week found in favour of arguments that the FCA had presented for policyholders.

The Times, Page: 41

Lord Digby Jones: Help businesses create wealth

Lord Digby Jones writes in the Express on ways Rishi Sunak could help boost the economy. Forefront in his mind should be support for small businesses and the first thing the Chancellor should do is exempt them from employers’ National Insurance. He also calls for fairer taxes for online giants which continue to get away with paying little tax on UK sales.

Daily Express, Page: 4

PERSONAL FINANCE NEWS – THURSDAY 24TH SEPTEMBER 2020

Brits veer away from asking banks about financial advice

A new survey carried out by SimpleUsability has found that 68% of UK banking customers would seek financial advice from sites like MoneySavingExpert or ask family members, before their own bank or app. The results also revealed changes in spending habits, reduced incomes and new ways of managing money. Judith Doherty, strategy director at SimpleUsability, comments: “Brands should be asking themselves, what can we do to make sure our customers come straight to us instead, and how can we support them across every touch point?”

The Fintech Times

ECONOMY NEWS – THURSDAY 24TH SEPTEMBER 2020

UK business activity growth slows as new Covid-19 restrictions take effect

Growth in business activity in the UK slowed in September, according to a closely watched survey that indicated a summer economic surge was at risk from new restrictions to curb coronavirus. The IHS Markit/Cips UK flash composite purchasing managers’ index, down from a 72-month high of 59.1 in August but still above the 50-mark separating expansion from contraction. The flash reading, based on 85% of the usual monthly responses, was taken before the prime minister announced further restrictions to control coronavirus on Tuesday. IHS Markit economist Chris Williamson warned: “Unemployment is likely to soon start rising sharply…(which) raises fears that growth could fade further as we head into the winter months, especially as lockdown measures are tightened further”.

Financial Times Sky News The Guardian, Page: 27 Daily Express, Page: 47 The Scotsman, Page: 47

Sunak scraps Budget to focus on jobs and business support

The Chancellor has postponed his November Budget until next year amid the financial turmoil created by the pandemic, but today will announce how a replacement for the furlough scheme will form part of a new economic rescue package. Rishi Sunak is expected to announce a wage subsidy scheme for people only able to work part-time, along with an extension to four different lending schemes. These should help keep credit flowing to businesses hit by the fallout from the virus, while companies could be given more time to pay VAT and other tax bills. The FT reports that the CBI, the TUC and Acas have issued a joint call to businesses to “exhaust all possible alternatives” before making redundancies, but if they became inevitable, to treat workers fairly.

The Daily Telegraph Financial Times, Page: 1 Financial Times The I, Page: 7 Daily Mail, Page: 1, 8-9 Daily Express, Page: 1, 4-5 The Guardian

BREXIT NEWS – THURSDAY 24TH SEPTEMBER 2020

UK companies under-prepared for Brexit, BCC finds

Analysis by the British Chambers of Commerce suggests only half of UK firms have taken steps recommended by the Government to prepare for Brexit while just 38% have completed a Brexit risk assessment this year, compared with 57% in 2019. BCC Director General Adam Marshall said: “The Government must ramp up engagement with businesses urgently to ensure that the real-world issues facing firms get tackled immediately.”

Bloomberg

INTERNATIONAL NEWS – THURSDAY 24TH SEPTEMBER 2020

Dimon open to higher income taxes for the wealthy

JPMorgan chief Jamie Dimon has backed the idea of higher taxes on the income of the rich but said a wealth tax would prove over-complicated and ultimately unworkable. “There are taxes which will slow down growth, like taxes on capital formation or labor, and there are taxes which will not affect growth, like taxes on, you know, well-to-do people like me,” he told CNBC on Wednesday. “I’m not against having higher tax on the wealthy,” Dimon said. “But I think that you do that through their income as opposed to, you know, calculate wealth, which becomes extremely complicated, legalistic, bureaucratic, regulatory, and people find a million ways around it. I would just tax income.”

New York Post

OTHER NEWS – THURSDAY 24TH SEPTEMBER 2020

Syndicate boss owes victims over £158m

Mike Stanley, whose Layezy Racing group collapsed last year, owes savers more than £158.7m, creditors say. Members of the betting syndicate alerted investigators after becoming concerned the outfit was a Ponzi scheme. After Layezy’s demise, some members were initially told by administrators Duff and Phelps that the liabilities from the syndicate could be as much as £80m. But a court recently heard that the figure is far higher than this.

Daily Mail, Page: 78

Contact Paul Southward