NEWS – WEDNESDAY 21ST OCTOBER 2020
NEWS – WEDNESDAY 21ST OCTOBER 2020
TAX NEWS – WEDNESDAY 21ST OCTOBER 2020
Sunak told self-employed won’t survive tax rises
With the Chancellor currently drawing up plans to plug the hole in Britain’s finances, Rishi Sunak has been warned that many contractors will not be able to survive if they are forced to pay more tax, with many having received no support at all during the coronavirus pandemic. Derek Cribb, the head of the Association of Independent Professionals and the Self-Employed, says Mr Sunak will find it difficult to sell the idea that the self-employed should pay more tax to “fill the coffers that have been emptied out into other people’s pockets”. However, the University of Oxford’s Professor Judith Freedman backs the idea of aligning the taxes of self-employed workers with normal employees arguing that the tax system was a poor way of rewarding risk. Ms Freedman also believes the tax base should be broadened by making pensioners pay national insurance. “I don’t think it will be popular, but I think it probably should be done ” she said.
Think tank outlines proposals to avoid tax hikes
The Centre for Policy Studies (CPS) has called for the pensions triple lock to be scrapped as part of a nine-point plan to repair the public finances. The think tank also proposes cuts to the aid budget and child benefit to be further limited as part of £30bn worth of spending cuts designed to spare the UK from post-Covid tax increases. Land and other state assets should also be sold. The head of policy at the CPS, Alex Morton, said: “Taxes are already at historic highs, and any further increases risk choking off any post-Covid recovery. The Government must re-examine its existing spending and ensure it is getting good value before considering raising tax further still. This package of savings is simultaneously radical but realistic – delivering better value for money for voters and allowing the Government to continue funding its priorities.”
The Guardian, Page: 37 Daily Express, Page: 5
HMRC urges universities to warn new students of tax scams danger
If any of your family friends or contacts have relatives at university, give them the heads up on the latest scam warnings from HMRC: warn-new-students-of-tax-scams-danger
Businesses urged to prepare for 1 January 2021 changes
The government urges business leaders to step up preparations for Australia-style arrangements from 1 January and launches ‘time is running out’ campaign. Read more here: new-trade-arrangements-with-the-eu-from-1-january-2021
Covid-19: Film and TV production restart scheme launches
The Government’s Film and TV Production Restart Scheme has officially opened.
The scheme is designed to help productions that have been halted or delayed by an inability to obtain insurance for Covid-19-related risks to get back up and running, by giving productions the assurance that they will be supported if future losses are incurred due to Covid-19. View the press release 500-million-film-and-tv-production-restart-scheme-officially-opens-from-today
Guidance on the scheme can be found at film-tv-production-restart-scheme
Working from home tax relief
Check to see if you can claim tax relief worth up to £124 tax-relief-for-employees/working-at-home
SMEs NEWS – WEDNESDAY 21ST OCTOBER 2020
Gender and ethnic disparities affect business outcomes
A study by the British Business Bank and consultancy Oliver Wyman argues that black and female business owners face “persistent disparities” in outcomes when compared with white male counterparts with ethnic and economic background, gender and geography having a “profound” effect on business outcomes. Education, deprivation, access to finance and under-representation in senior positions in the workforce explain these disparities in part, but systemic disadvantage “also appears to play a role”, the report added. Roianne Nedd, global head of diversity at Oliver Wyman, said: “What should be a level playing field is littered with obstacles.” Although the report was welcomed by Tom Adeyoola, an entrepreneur who campaigns for equality in access to finance, he said he was “disappointed that there are no recommendations for any interventions”.
The Times, Page: 36 The Independent, Page: 45
SME owners hit hard by Covid stresses
New research from Santander reveals that a third of small business owners say working through the pandemic has negatively affected their mental health while two in five are questioning whether they want to continue running their business due to the pressure COVID-19 has created. Four in 10 women said the pandemic had impacted their mental health, compared to less than a third of men.
Daily Mirror, Page: 35
FINANCE NEWS – WEDNESDAY 21ST OCTOBER 2020
Banking industry could establish new debt collection agency
UK Finance is conducting a feasibility study into the creation of a new agency to manage the collection of overdue government-backed bounceback loans. The new body would reduce pressure on banks to collect debt and could bring a more consistent approach to borrowers, according to the Times.
INSOLVENCY NEWS – WEDNESDAY 21ST OCTOBER 2020
Experts say pre-pack reforms are ‘flawed’
Government plans to tighten scrutiny of connected-party pre-pack administrations have been hit with criticism after draft regulations show the opinion of multiple “evaluators” could be sought by dealmakers, leaving the system open to abuse, according to the Insolvency Service. Colin Haig, president of R3, the trade association for insolvency professionals, said this meant that “effectively anyone will be allowed to provide an independent opinion on a connected party pre-pack sale, which risks abuse of the system that undermines the entire rationale of these reforms”.
CORPORATE NEWS – WEDNESDAY 21ST OCTOBER 2020
Boohoo bosses lift stakes as shares plunge
The Times reports that senior directors of Boohoo bought shares in the fashion group immediately after PwC confirmed it was standing down as its auditor, news which sent its shares plunging 20%. PwC’s move comes amid an ongoing scandal into working conditions at Boohoo suppliers.
The Times, Page: 38 Daily Mail, Page: 72
ECONOMY NEWS – WEDNESDAY 21ST OCTOBER 2020
BoE: Negative rates may be needed to boost recovery
Gertjan Vlieghe, a member of the BoE’s MPC, has indicated that negative interest rates could soon be needed to boost the economy as the second COVID wave hits the recovery. Mr Vlieghe said that in countries where negative rates have been tried, “the effect has generally been positive”. The BoE has taken interest rates to a record low of 0.1% and used QE to inject more money into the system and lower rates in financial markets. However, Mr Vlieghe said that “QE is probably less potent now than in March”, which meant the Bank needed to consider other options including taking rates below zero. “There is a tremendous challenge ahead. Given that virus prevalence has been increasing again recently, it is likely to weigh more heavily on economic activity. Indeed, it appears that the downside risks to the economic outlook are starting to materialise,” Mr Vlieghe said. “In my view, the outlook for monetary policy is skewed towards adding further stimulus. My own view is that the risk that negative rates end up being counterproductive to the aims of monetary policy is low.”
The Daily Telegraph Evening Standard
Contact Paul Southward