The Great Debate UK
Tax year end – are you ready?
Rachel Mason is public relations manager at independent financial service providers Fair Investment Company.The opinions expressed are her own. Reuters will host a “follow-the-sun” live blog on Monday, March 8, 2010, International Women’s Day. Please tune in.-
With the end of the tax year fast approaching, now is the time to make sure all your finances are in order and that you are maximising all the annual allowances, reliefs and exemptions available.
Make the most of your ISA allowance – aged 50 and over, you’ve got an extra 3,000 pounds!
You can’t carry your ISA allowance over into the next financial year, so if you haven’t made the most of it – use it, or you’ll lose it. The current limit is 7,200 pounds – all of which can be invested into a stocks and shares ISA or up to 3,600 pounds can be invested into a cash ISA with the remainder in stocks and shares.
But for those aged 50 and over, the limit is £10,200, £5,100 of which can be invested in a cash ISA. This new limit, which came into force in October 2009, will be extended to all other ISA investors from April 6th 2010.
Inequality in the UK: the paradox under Labour
-Ali Muriel is a Senior Research Economist at the Institute for Fiscal Studies. The views expressed are his own.-
Start with two (apparently contradictory) facts about income inequality in the UK:
from Breakingviews:
Europe’s banks will suffer less from U.S. tax
-- Margaret Doyle and George Hay are Reuters Breakingview columnists. The opinions expressed are their own. --
European banks should suffer less than their American counterparts from the Obama administration’s proposed bank tax. The president’s proposed levy on banks’ wholesale funding requirements will hit all banks with a big presence on Wall Street. But assuming that U.S. banks will be taxed on their worldwide operations, the levy will hurt them more. This could be a major bonus for European investment banks -- as long as their own governments don’t follow suit.
from Breakingviews:
Bank liability levy may not be foolish
A levy on bank liabilities would get the industry squealing - especially if it approached $120 billion. But the Obama administration isn’t crazy to float the idea. A well-crafted tax could help recoup bailout costs while also giving banks an incentive to behave more sensibly. It doesn't have to apply just to the United States, either.
Populism aside, the main rationale for a levy is that the size of a bank's liabilities is a goodish proxy for the risk it poses to the financial system - as well as the benefit it received from the cheap money central banks doled out to offset the credit crunch. It’s reasonable that banks should pay for help from their lenders of last resort.
from The Great Debate:
UK bonus tax both cynical and justified
(James Saft is a Reuters columnist. The opinions expressed are his own)
A cynical election maneuver it may well be, but Britain's plan to impose a punitive tax on bonus payments is also reasonably well crafted and in broad terms justified.
Facing a monumental budget deficit and an election in months, British Chancellor Alistair Darling announced a plan to slap a 50 percent payroll tax, payable by banks, on their bonus payments in excess of 25,000 pounds to a given employee.
Darling’s pre-budget should support small business
-Joe White is chief operating officer at Gandi, an Internet domain name registration firm. He will participate in a Reuters pre-budget live blog on Dec. 9, at 12 p.m. British time. The opinions expressed are his own.-
The pre-budget speech will primarily be about two things: reducing the size of the national deficit, and drawing the political battle lines around the economy for the general election.
Pre-budget report delicate balancing act for Darling
– Thomas Story is tax director at BDO. He will participate in a Reuters pre-budget live blog on Dec. 9, at 12 p.m. British time. The opinions expressed are his own. -
Alistair Darling is facing the most difficult set of economic circumstances for any chancellor since the 1940s, with the projected substantial fiscal deficits for 2009 – 2010 and 2010 – 2011 likely to be revised upwards from 175 billion pounds to well in excess of 200 billion pounds. He must perform a delicate balancing act to secure the confidence of the global financial markets while protecting any fragile economic recovery and boosting public confidence.
Simplify employment tax to kick-start recruitment
-David Ellis is partner and head of human capital at BDO LLP. He specialises in the development of tax efficient, performance driven long term incentive plans for senior employees. The opinions expressed are his own.-
There’s no doubt about it, the UK’s complex employment tax regime is a major barrier for businesses to attracting talent. For our new report, launched today, we spoke to 126 financial decision-makers and we found that 34 per cent would be more likely to employ additional staff if taxes were reduced or reformed.
from Commentaries:
“Tobin tax” gaining ground in Europe
No longer just a hopeless cause for anti-capitalist activists, the idea of a global tax on financial transactions is gaining ground in Europe.
European Union leaders could not agree to put it on the agenda of this week's G20 summit on reforming the financial system in Pittsburgh, but the leaders of France, Germany and the European Commission endorsed the concept.
More strikingly, the head of Britain's Financial Services Authority, which regulates the world's second biggest banking centre, said last month that such a levy could help shrink a swollen financial sector.
Wrong, wrong and wrong again – a response to “Latvia: let the lat go”
- Morten Hansen is a guest columnist, the views expressed are his own. He is head of the economics department at the Stockholm School of Economics in Riga -
The debate for or against a Latvian fixed exchange rate rages on. There are good pieces of analyses on both sides of the debate, there are less good ones, there are mediocre ones – and then there is Jonathan Ford’s “Latvia: let the lat go” from 29 July.
