Money blog: Rich Britons will 'bear largest burden' in budget, chancellor confirms (2024)

Top news
  • Rich Britons will 'bear largest burden' in budget, chancellor confirms
  • More than £3bn wiped off value gambling firms after newspaper tax raid claim
  • Revolut named in more fraud complaints than any major UK bank last year
  • Two big-name chefs announce closures - as hotel where another works put up for sale
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09:16:32

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15:45:01

Waitrose staff being targeted by 'brazen and aggressive' gangs

Waitrose staff are being attacked by aggressive organised gangs, the company's chief executive has said.

Armed assaults on workers have risen by 15% in the past year, James Bailey told the Mail on Sunday.

Mr Bailey said: "We've invested a lot in security including CCTV, body-worn cameras and public display monitors. But the threat from brazen and aggressive gangs is still prevalent in some stores.

"It's an industry-wide problem that needs industry collaboration before it gets any worse."

In September, a man was handed an 18-month suspended sentence after he hit a shop worker in the face with a can after being asked to leave Waitrose in Buxton, Derbyshire.

After hitting the terrified worker, James Hudson made a call saying: "I've got this lad that needs sorting out, I'll give you £5,000 to come shoot him."

It comes as shoplifting offences reached a 20-year high.

15:21:09

Rich Britons will 'bear largest burden' in budget, chancellor confirms

Rich Britons will feel the most pain in the budget, the chancellor has said.

Rachel Reeves said those with the "broadest shoulders" would "bear the largest burden" of expected tax rises on 30 October.

"I said during the election campaign we're not going to be introducing a wealth tax," she told Andrew Marr on the New Statesman's NS podcast.

"But I think people will be in no doubt when we do the budget that those with the broadest shoulders will be bearing the largest burden.

"You saw that in our manifesto campaign. You know, non-doms, private equity, the windfall tax on the big profits the energy companies are making and putting VAT and business rates on private schools."

Some have suggested a crackdown on non-doms could lead to an exodus - meaning a policy that was supposed to increase the tax take is undermined.

"I'm confident, the UK is an amazing country where people want to be," said the chancellor.

"And previously when taxes on non-doms have been changed you haven't seen that flight.

"I think it's a really important principle that if you make Britain your home you pay your taxes here… It's not on and we will change that and we will have a proper system."

14:48:45

Revolut named in more fraud complaints than any major UK bank last year

Revolut received more fraud complaints than any other major UK bank last year, a new report has found.

The global neobank was named in 9,793 fraud reports sent to the UK's reporting centre, Action Fraud, according to a freedom of information (FOI) request submitted by the BBC'sPanorama.

This was about 2,000 more than Barclays and Lloyds, and double the number seen about Monzo.

Revolut said it recognises that a "small number" of its customers have had negative experiences with the company, but it does not believe that to be the case for the "vast majority of customers who continue to enjoy Revolut's products and services".

"Revolut takes fraud and the industry-wide risk of customers being coerced by organised criminals incredibly seriously," a spokesman said.

Nevertheless, one Revolut customer told the BBC he had £165,000 stolen from his business account by fraudsters, after being tricked into sharing information and authorising payments to fake accounts.

Jack said it took 23 minutes after contacting Revolut via its in-app chat function to reach the right department to freeze his account, during which time another £67,000 was taken.

He said he felt he was failed by the app's systems, which did not automatically spot that a large number of transactions to a new payee could have been suspicious activity.

13:30:13

Why is Germany in such a bad economic state?

By Siobhan Robbins, Europe correspondent

They call it "the sick man of Europe" and with back-to-back recessions looming, Germany's economic woes look set to continue.

Gloomy figures suggest the economy could contract by 0.2% in 2024, a depressing reversal of the government's previous projection of 0.3% growth for the year.

"The economic conditions are not satisfactory," admitted economic affairs minister Robert Habeck when he unveiled the latest forecasts.

If he's right, Germany will suffer its first two-year recession in more than 20 years and will likely be theonly G7 economy in contraction.

This after it was already the weakest among its large eurozone peers with a 0.3% decline in gross domestic product (GDP) last year.

So, what's going wrong for the European powerhouse?

"The German economy is stuck in crisis. There has been no revival in economic output for more than two years," explainedexplainsProfessorTimo Wollmershauser from Germany's IFO institute.

"The crisis is first and foremost a structural crisis. Decarbonisation, digitalisation, demographic change, the coronavirus pandemic, the energy price shock, and China's changing role in the global economy are putting pressure on established business models and forcing companies to adjust their production structures," he added.

The war in Ukraine and the end of reliance on cheap Russian energy undermined one of the key pillars the German economy was built on.

Its energy intensive industry meant it was hit hard.

While energy prices have begun to ease, weak global demand, geopolitical tensions and falling exports continue to take their toll.

"Half of Germany's growth always comes from exports and if you look at what's going on in the world, you have to say that this pillar is also under attack," Mr Habeck said. "China is pursuing an aggressive export strategy."

Add to this domestic political instability with infighting in the coalition government, a surge in support for the far right, a fast-approaching general election, a skills shortage, and long-term issues of excessive red tape and underinvestment in infrastructure and you have the perfect recipe for stunted economic growth.

Why should you care?

Due to its size, the German economy is a major driver for economic development throughout the EU.

Figures from the International Monetary Fund (IMF) show that its economy in terms of GDP is roughly equivalent to Poland, Sweden, Croatia, Austria, Norway, Romania, Czech Republic, Hungary, Finland, Slovakia and Bulgaria's combined.

In short, shockwaves from long-term economic struggles will be felt well beyond its borders.

While the government says it's been working hard to bring down inflation and interest rates, Germany remains the "most distressed" European market, according to a recent report.

The Weil European Distress Index, which uses data from 3,750 European-listed companies, found corporate distress levels are at their highest since the start of the coronavirus pandemic.

Germany's position as a major manufacturing hub left it especially exposed and the US election results have the potential to make conditions even tougher.

"The potential policy changes that could follow pose further risks to Germany's economy,"October's Weil report warned.

"Proposed tariffs on international goods could hit the manufacturing sector hard, with the Ifo Institute forecasting a 32% decline in car production, deepening the struggles of an already fragile industrial base."

Volkswagen's recent announcement that job cuts and factory closures could not be ruled out at its German plants are another symptom of Germany's economic headache.

Europe's top automaker is under pressure due to weak European demand, competition from China, high production costs in Germany and challenges around vehicle electrification.

On Friday it reported a drop in global deliveries in the last three months with shipments to China, the world's biggest car market, down by 15%.

The auto sector accounts for about 7-8% of German GDP, so an ongoing decline would threaten the country's prosperity.

As one analyst recently told the press: "When the German automotive sector has a cough, Germany has the flu."

Union representatives are calling for a clear commitment to industry including investment in infrastructure and improved working conditions to help secure skilled workers.

The government has already agreed a package it hopes will help boost the economy.

Ministers say they're expecting a return to growth of 1.1% in 2025, although some analysts are more cautious.

13:22:27

Ex-Google boss sends investment warning to Starmer

Sir Keir Starmer has welcomed business leaders from around the world for a major investment summit - but a former Google boss warned the PM regulatory rules in Britain are "killing" opportunities for companies to buy in.

You can read about the summit, with live updates through the day, in our Politics Hub...

11:59:26

Two big-name chefs announce closures - as hotel where another works put up for sale

Two big-name chefs have announced restaurant closures as the terrible year for culinary giants continues.

Glynn Purnell, two-time winner of Great British Menu, has shuttered his flagship restaurant, Michelin-starred Purnell's in Birmingham, after 17 years.

The chef, who trained under the likes of Gordon Ramsay and Gary Rhodes, said: "Purnell's has been my proudest moment, and I am heartbroken to say that after 17 years we have served our final guest."

He went on: "The world doesn't stand still. Things have moved on, and times have changed. In this current climate, no-one is bulletproof."

Purnell's two other restaurants will remain open.

Meanwhile, fellow TV regular and Michelin-star holder Michael Caines has closed two of his sites in Devon "in preparation for a sale".

Mickeys Beach Bar & Restaurant and Café Patisserie Glacerie at the Sideshore in Exmouth have gone as part of "planned closures".

As we reported in our Saturday long-read, hardly a week has gone by this year without another big-name chef closing a restaurant amid rising costs, staff shortages and a sense the public isn't willing to blow out on high-end food the way they used to.

Marco Pierre White, Michel Roux Jr, Marcus Wareing, Monica Galetti, Simon Rimmer and Tom Brown have all announced closures in the last 12 months.

A third piece of news today is related - though there is no restaurant closure.

The hotel Northcote, in Lancashire, has been put up for sale.

It is home to aMichelin-starred restaurant run by chef Lisa Goodwin-Allen.

10:13:43

Businesses face a £2.6bn 'cliff edge' moment in April

Retail and hospitality firms face a £2.66bn a year rise in business rates in April, leaving the sector facing a "cliff edge" moment.

Shops, pubs and restaurants currently get a 75% relief on their business rates but this is not set to continue past 31 March next year.

No future discounts have been factored into fiscal forecasts and the chancellor has already warned of "tough decisions" at a spending review at the end of October.

The tax is only levied against businesses which have a physical premise, so has been criticised for handing digital-only retailers an unfair advantage.

Alex Probyn, president of property tax at data firm Altus Group, warned that the sectors face a "cliff edge" moment unless the tax break is extended in the upcoming budget.

08:49:58

More than £3bn wiped off value gambling firms after newspaper tax raid claim

By James Sillars, business reporter

More than £3bn has been wiped off the value of gambling stocks this morning amid tax raid speculation.

Entain, the owner of Ladbrokes and Coral, was among the biggest fallers on the FTSE 100, losing around 15%.

Grosvenor casinos operator Rank Group plummeted 6.7%, while William Hill owner Evoke was down by over 16.2% at one point.

They were hit in reaction to a report by The Guardian at the weekend that the chancellor is considering a £3bn hike to gaming duties in the budget.

"It's definitely on the map," a source familiar with Treasury thinking told the newspaper. "There's no obvious pushback to it."

The left-leaning Institute for Public Policy Research (IPPR) says up to £3.4bn could be raised by 2030 by doubling taxes on "higher harm" products such as online casino games.

The report claims the 15% general betting duty, levied on high-street bookmakers' profits, could be doubled.

Remote gaming duty could go from 21% to 50%.

Elsewhere, oil prices are worth a focus this morning after the rises of last week.

A barrel of Brent is down by more than 1% in early trading to stand at $78.

There is a mire of conflicting factors driving prices at the moment.

Carrying the most weight today seems to be the view that further economic stimulus in China will not provide a big boost to demand for oil.

The Middle East crisis - and the prospect of supply disruption - has been a constant fear for more than a year.

07:59:49

British Airways cancels hundreds of flights over Rolls-Royce delays

British Airways has cancelled hundreds of long-haul flights due to delays in the delivery of engines and parts from Rolls-Royce.

The Heathrow-Kuala Lumpur and Gatwick-New York JFK routes are among those impacted.

"We've taken this action because we do not believe the issue will be solved quickly," a British Airways spokesperson told Reuters.

"We've apologised to those affected and are able to offer the vast majority a flight the same day with British Airways or one of our partner airlines."

The airline said it would continue to work with Rolls-Royce and seek reassurance of a "prompt and reliable solution."

While many affected will be flown to their destination on other carriers (such as Qatar Airways, a part-owner of BA), grounding some routes - even temporarily - could raise prices.

"Even if British Airways sends only a couple of dozen passengers a day to each of those Qatar Airways departures, fares for the rest of us will rise and availability will fall," travel expert Simon Calder wrote in The Independent.

"The same applies to Malaysia Airlines, which will pick up the BA travellers who have been told the launch of flights from Heathrow to Kuala Lumpur has been cancelled for now.

"And while London-New York is awash with capacity, taking 300-plus seats out of the market will make Christmas and New Year flights even more expensive."

A Rolls- Royce spokesperson said: "We continue to work with British Airways and all of our customers to minimise the impact of the limited availability of spares due to the current supply chain constraints.

"Unfortunately, this is an issue affecting the whole aerospace industry."

Money blog: Rich Britons will 'bear largest burden' in budget, chancellor confirms (2024)
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