Written By Unknown on Kamis, 04 Desember 2014 | 00.12
By Tom Cheshire, Technology Correspondent
Chancellor George Osborne singled out the low taxes being paid by tech giants in his Autumn Statement and vowed to tax them.
The "diverted profits tax" will target those companies that use elaborate off-shore mechanisms to pay minimum UK tax and apply a 25% rate.
"Some of the largest companies in the world, including those in the tech sector, use elaborate structures to avoid paying taxes," Mr Osborne said.
"That's not fair to other British firms. It's not fair to British people either. Today we're putting a stop to it.
"My message is consistent and clear: 'Low taxes, but low taxes that will be paid'."
Video:2013: Online Giants Face Tax Probe
Tech firms have come under criticism for the meagre tax they paid to the UK Treasury.
Facebook paid just £3,169 in 2013. Amazon paid £10m, Apple paid £11m and Google paid £11.6m.
The cumulative revenues of these four companies in the UK is more than £17bn.
Video:2012: Facebook's UK Tax Payments
However, it does not appear that the tax will claim a significant portion of those figures.
The Treasury said the tax would raise only £360m per year by 2016-2017, and said: "A behavioural adjustment is also made to reflect groups that attempt to mitigate the tax impact."
Stella Amiss, corporate tax partner at PwC, said: "The diverted profits tax on multinationals appears narrowly focused as it will raise about £300m a year."
The main measures and forecasts as outlined by the Chancellor George Osborne in his Autumn Statement:
TAX
:: Stamp Duty rates overhauled. Top rate now 12% on properties worth more than £1.5m effective from midnight Wednesday. There will be no duty on properties worth up to £125,000 then 2% rate on the portion up to £250,000 then 5% up to £925,000, then 10% up to £1.5m.
:: Higher rate income tax threshold to rise to £42,385 next year.
:: Income tax-free personal allowance to rise to £10,600 rather than the planned £10,500 next year, giving wage boost of £825 a year.
Video:Osborne's Good News For Homebuyers
:: ISAs can be inherited tax free.
:: Fuel duty remains frozen.
:: People who die under 75 to be able to pass on annuities, tax free.
CORPORATE TAX
:: A so-called 'Google Tax' will introduce a levy of 25% on profits shifted abroad by multi-national firms. The Diverted Profits Tax aims to raise more than £1bn over five years.
:: Banks to pay almost £4bn more in tax over next five years, with profits which can be offset by losses for tax purposes to be limited to 50%.
:: Inflation-linked increase in business rates capped at 2% and discount for shops, pubs and cafes increased by 50% to £1,500.
SAVINGS
:: Limit on saving in New ISAs to rise to £15,240
DEVOLUTION & 'NORTHERN POWERHOUSE'
Video:Autumn Statement: The Highlights
:: Business rates for Wales to be devolved to Welsh Government.
:: Plans law to devolve corporation tax to Northern Ireland if the Northern Ireland executive shows it can manage the financial implications.
:: Investment of £250m in new advanced material science institute in Manchester with branches in Leeds, Sheffield and Liverpool. Tendering for new franchises for Northern Rail and Trans-Pennine Express to ensure modern trains.
EDUCATION
:: Government-backed student loans of up to £10,000 are to be made available for postgraduates.
TRAVEL
:: Air Passenger Duty for under-12s abolished from May 2015. Scrapped from 2016 for under-16s.
SAVINGS
:: A further £10bn of Whitehall efficiencies is planned while £5bn more is sought from crackdown on tax evasion and avoidance.
:: Public service pension reforms will be completed, saving £1.3bn annually.
Video:Miliband Laughs Off Osborne Jibe
SPENDING
:: NHS gets additional £2bn every year for frontline services. A £1.2bn investment in GP services will be paid for from foreign exchange fines.
:: Government spending £10bn less than forecast this year but warns the coming years will require "very substantial savings in public spending."
PUBLIC FINANCES
:: Office for Budget Responsibility (OBR): Forecast 2014 GDP growth upgraded to 3% from 2.7%. 2015 forecast raised to 2.4%.
:: "Deficit is falling this year and every year." Deficit now cut in half. OBR forecasts borrowing to fall from £97.5bn in 2013/14 to £91.3bn in 2014/15 (£5bn above annual target). Budget surplus of £23bn predicted for 2019/20.
:: Osborne says deficit reduction better than some predicted as welfare spending is lower and interest paid on national debt is considerably lower.
:: OBR predicts wage growth above inflation for the next five years.
Ladbrokes is beginning a search for a new chief executive as Richard Glynn prepares to leave the business.
The bookmaker made the unusual announcement in a statement to the stock exchange which confirmed he intended to remain in charge until a successor was appointed next year.
He has been at the helm for five years, during which time the industry has undergone a mobile betting and gaming revolution.
Ladbrokes has invested heavily in its digital offering amid criticism it was struggling to keep pace with market leader William Hill.
The company said that from the start, Glynn's mission had been to turn around the company within a five-year term, a process the board insisted was on track.
The statement said: "The board will shortly start a process to identify his successor and the search will evaluate both internal and external candidates."
Ladbrokes said its trading remained within its previous expectations.
Its profits halved in the first six months of 2014 to £27.7m - a result of its investment in digital and gaming - but said in August it was now ready for growth.
Ladbrokes said it had delivered on all its key operational objectives during the period, which included switching its gaming products to a new system and replacing 9,000 gaming machines with more sophisticated models.
The company has also been closing down unprofitable betting shops - with a total of 50 to be lost this year.
Mr Glynn said: "Everyone at Ladbrokes has worked incredibly hard over the past nearly five years to deliver the transformation programme.
We have faced significant operational challenges, as well as economic and regulatory headwinds.
"However, I am pleased that the business is fundamentally stronger than it was and now has the operational and digital capabilities to compete effectively.
"We have delivered against all of the recent milestones and increasingly shown real competitive momentum."
"It has been a privilege to lead Ladbrokes over this crucial phase. I am very proud of the resilience and professionalism the team has shown during this intense period of activity.
"It is the right time for Ladbrokes to identify my successor. I will continue to serve the company to help ensure a smooth succession.
"I look forward to the company, the shareholders, our partners and, in particular, everyone in the team reaping the benefits over the next few years of all that has been sown."
Actor and comedian Russell Brand has threatened to take legal action over a report containing claims about his housing arrangements.
The comedian and actor, who has been campaigning over the rising cost of homes in the UK, has been also been adding his voice to anti-capitalist protests.
A report in The Sun newspaper made claims in connection with the home Brand rents in London and a firm registered in the British Virgin Islands, a region considered a tax haven.
Brand took exception to O'Brien's questions. Photo: Channel 4 News
In a post directed at the paper and owner Rupert Murdoch - chairman and CEO of 21st Century Fox, which owns a 39.1% stake in Sky, parent company of Sky News - Brand wrote: "Hey... I'm gonna sue you and give the money to #NewEraEstate and JFT96."
Earlier this week, the author of the best-selling book Revolution joined hundreds of residents and supporters of the New Era estate in east London, to protest against a takeover by a US investment firm which, the residents fear, could lead to a huge hike in rents.
Video:Brand Strips For The Revolution
JFT96 stands for justice for the 96 in reference to the number of football supporters who died in the Hillsborough disaster.
Brand, 39, was caught up in a row with Channel 4 journalist Paraic O'Brien at Downing Street when the reporter asked how much Brand himself paid in rent and suggesting the housing problem was being worsened by the super-rich buying property in London.
The celebrity became agitated at the challenge and pointed his finger in the journalist's face, calling him "a snide".
During the interview, Brand told the reporter: "I'm not interested in talking to you about my rent, mate. I'm here to support a very important campaign."
When asked about the value of his home, he went on: "It's rented. We don't know the value, you would have to talk to my landlord.
"Blessedly, I can afford my rent and I'm prepared to stand up for people that can't."
Brand later discussed the interview on his YouTube news channel, likening it to a "quarrel at a jumble sale".
Video:2012: Brand Speaks Out Over Drugs
The comic and actor said: "I shouldn't be allowed on television. I'm so easily wound up. What does it matter to me, what have I got to lose, just from this one bloke?
"But I'm a volatile person."
He went on: "When you talk to a journalist I sort of think it's a combination of boring and really annoying, and my personality type is not well suited to that kind of environment."
O'Brien wrote on Twitter: "Is it my job to test tension between private circumstances and publicly held views of celebrities? Yes."
Westbrook Partners, the US investment firm involved in the New Era buyout, responded on Monday to claims of "social cleaning... forcing ordinary, working-class people out of London".
In a statement, the company said: "There will be no changes to their residential leases and no increases in rents during the first half of 2015."
UK workers at Jaguar Land Rover (JLR) are to be balloted on a new pay offer, weeks after talks broke down and sparked threats of industrial action.
Staff affiliated to the union Unite had reportedly demanded a bonus and a salary increase of more than 3% over the next three years, arguing they deserved a better reward for their contribution to the firm's turnaround.
JLR, owned by Indian firm Tata Motors since 2008, has enjoyed a resurgence in profits - doubling in three years to £2.5bn - thanks to strong demand for luxury, especially in China, where it has just opened its first plant.
The carmaker, which built almost one in three of Britain's 1.5 million cars in 2013, said it had revised its original offer with a pay increase of 4.5% in the first year of a two-year deal, plus a bonus payment of £825 per employee.
In the second year, workers will receive the higher of either 3% or the Retail Price Index measure of inflation plus 0.5%.
Around 15,000 union members would benefit from the deal, according to Unite.
A joint statement from Jaguar Land Rover said: "A revised offer has been made by the company that will be unanimously recommended by Unite to its members."
Households with a single bread-winner spent more than they earned last year, as the typical outgoings of families increased, official figures show.
The Office for National Statistics (ONS) said its Family Spending report found that households spent £517.30 per week in 2013, a rise of more than £16 on the previous year when adjusted for inflation but below 2006 levels.
Income data had previously shown average weekly earnings at £517 per person during the period.
Housing, fuel and power costs overtook transport to become the biggest area of spending at a record £74.40 per week.
And it seemed people put a higher price on having a good time ahead of debt worries as recreation and culture was the third largest spending category, with an average £63.90.
Gas and electricity costs hit record levels in 2013
It includes spending on TVs, computers, newspapers, books, leisure activities and package holidays.
The ONS said average weekly expenditure on food and non-alcoholic drinks in 2013 was £58.80 - with £15.60 of this being spent on meat and fish, £4.30 on fresh vegetables and £3.30 on fresh fruit.
The figures showed around £22.60 is spent on clothing and footwear.
There was a North-South divide when it came to the regional breakdown of the statistics.
Householders in South East England spent more than Londoners by an average £6 extra at £585.40, partly reflecting higher commuter costs.
The North East spent the least at £424.60 per week.
The figures were compiled at a time when inflation easily outstripped earnings growth, further eroding family spending power.
Rises in the cost of living are currently more evenly matched to wage increases.
Most studies that show the negative impact plain cigarette packets would have on the economy are funded by "big tobacco" firms, according to a damning report.
Such companies have warned standardised packaging would fuel a black market in cigarettes – citing research that echoes their concerns.
But the University of Bath claims more than 50% of such evidence comes from reports commissioned by the industry itself – or from third parties with financial connections to it.
The Tobacco Control Research Group, funded by Cancer Research UK, also found 66% of the industry's claims were just opinions – and that of the 51 MPs opposed to plain packaging, seven of them had accepted hospitality from the sector.
George Butterworth, from Cancer Research UK, said: "By failing to disclose financial links to misleading evidence, this is lobbying at its worst.
"For years, misinformation has been their currency, but as the success of plain, standardised packaging in Australia becomes clear – now with record low smoking rates – 'big tobacco' is looking spent.
"Independent evidence consistently demonstrates the role that standardised packaging can play in protecting children from a deadly addiction.
"Now, the UK Government must treat the tobacco industry's spin with the contempt it deserves – and introduce regulations without delay."
Historic changes to one of the UK's "most damaging" taxes have formed the centrepiece of George Osborne's Autumn Statement.
The Chancellor said he was abolishing the "slab rate" of stamp duty - which means huge increases in tax when house values enter a new band.
In future, he said, the tax would apply progressively to the part of the property in each band, like income tax.
The new rates will see house-buyers pay 0% on the first £125,000 then 2% on the portion up to £250,000, 5% up to £925,000, 10% up to £1.5m and 12% on anything above that.
Mr Osborne said the changes - effective from midnight - would save £4,500 on the cost of an average home and cut stamp duty for 98% of house-buyers.
He said: "It is a fair, workable, lasting reform to the taxation of housing."
Video:Labour Response To Autumn Statement
The changes will cost the Treasury "nearly £400m" over the next four months, according to the Office for Budget Responsibility.
The Chancellor also announced a plan to cut the cost of air travel for millions of families by abolishing air passenger duty for children under the age of 16 over the next two years.
He also pledged to freeze fuel duty.
Mr Osborne said some death taxes would be abolished - allowing savers to pass on pensions and ISAs to loved-ones tax fee.
Video:Autumn Statement: The Highlights
And he promised to "revolutionise" support for post-graduate students with the introduction of government-backed student loans of up to £10,000.
The Chancellor used the statement to trumpet the Conservative-led Government's economic credentials, telling Parliament: "Our long-term economic plan is working."
He said the Office for Budget Responsibility (OBR) had revised up the British economy's growth forecast to 3% and told MPs the UK was now enjoying "more balanced" growth.
On the controversial issue of the deficit, Mr Osborne was cheered by his own MPs and jeered by the opposition as he revealed better-than-expected figures.
Video:Figures Breakdown
He said the OBR's forecasts show borrowing is falling and would continue to fall until a budget surplus is achieved in 2018/19.
Labour Shadow Chancellor Ed Balls said the Chancellor's policies had left workers £1,600-a-year worse off.
He said: "For working people there is a cost-of-living crisis and that squeeze on living standards is not only hitting family budgets - it has also led to a shortfall in tax revenues."
He accused Mr Osborne of missing his targets on clearing the deficit and reducing the national debt, but not telling MPs by how much.
Video:Miliband Laughs Off Osborne Jibe
The Chancellor warned that in the coming years there would have to be "very substantial" spending cuts.
He vowed to claw back money from those who pay "paid too little" tax - including multinational firms, who will face a 25% tax on profits generated in the UK, which are then shifted overseas.
He claimed the tax would raise £1bn over the next five years, while changes to tax rules for banks would raise another £4bn over the same period.
He said the Government's policies would mean the richest 20% paying more tax than the remaining 80% put together - which he claimed proved the Tory slogan: "We're all in this together."
Video:Autumn Statement: Debt Vs Deficit
There was a promise of help for small businesses - with a doubling of Small Business Rate Relief and a review of the structure of business rates.
Many of the measures announced had been trailed ahead of the speech - such as a plan to repay the national debt incurred to fight the First World War, road building schemes, flood defences and investment in the NHS.
One of the fastest-growing lenders to small and medium-sized companies (SMEs) is poised to accelerate plans for a stock market listing in the wake of fresh Government support for the sector.
Sky News has learnt that Shawbrook, which was set up in 2011 to take advantage of declining SME lending by the major high street banks, has appointed Bank of America Merrill Lynch and Goldman Sachs to prepare a public flotation.
The listing is expected to take place during the course of 2015, and could see Sir George Mathewson, the former chairman and chief executive, return to the helm of a listed company.
Sir George, 74, is Shawbrook's chairman, and he and the bank's board are understood to be open-minded about whether he will remain in the role through the process of a flotation.
Shawbrook's prospects as a public company are likely to be boosted by the announcement on Wednesday that the Funding for Lending Scheme overseen by the Treasury and Bank of England is to be extended and refocused towards SME lending.
George Osborne, the Chancellor, also said on Wednesday that the Government's Business Bank would receive additional investment.
Shawbrook said in September that it had grown total lending during the first half of the year by 91% compared to the same period in 2013.
It specialises in areas such as commercial mortgages and asset finance, and funds its lending activities from retail deposits.
The bank is majority-owned by Pollen Street Capital, an investment vehicle previously owned by RBS.
The taxpayer-backed lender remains an investor in Pollen Street's fund but has no role in its management or strategy.
Shawbrook is expected to be valued at several hundred million pounds if it goes public, which would potentially coincide with share offerings by a number of other so-called 'challenger banks'.
Virgin Money recently revived plans for a listing, while Aldermore shelved its flotation following stock market volatility in October.
Metro Bank has signalled to its shareholders that it is likely to pursue a public offering by the end of 2016.
Last year, Shawbrook brought in external investors for the first time, recruiting CarVal, another investment vehicle, through the issuance of new debt.
Announcing half-year results in September, Richard Pyman, Shawbrook's chief executive, said:
"We continue to see strong demand from credit-worthy SMEs and individual customers who are seeking a straight-forward, quality relationship with their bank.
"Our focus on specialist teams and a human approach to decision making to deliver excellent customer service has enabled us to grow our lending to small businesses by £685m in the twelve months to June 2014."
Shawbrook and Pollen Street Capital declined to comment on the appointment of BAML and Goldman.
