Thursday 2 July 2015

Thursday, July 02, 2015 Posted by Jake No comments Labels:
Posted by Jake on Thursday, July 02, 2015 with No comments | Labels:

Regulator demands energy firms end the madness where the POOREST are charged MORE
Those least able to pay are being charged huge fees and forced to pay more for the energy they use by suppliers. Industry regulator Ofgem says there are now a record 7.2million prepayment gas and electricity meters in homes. But despite a big chunk of those being low incomes households, they pay higher prices than many others . To make matters worse, just over half of suppliers add a fee to install a meter in the first place. Others want money to have them removed. Ofgem also found firms demanding “security deposits” of up to £5,000 in one case before they’re supply a customer. Ofgem wants the Energy firms to ditch charges, because they are preventing prepayment meter (PPM) customers switching to cheaper deals. The average PPM customer pays £1,266 a year for gas and electricity. Yet they could save around £66 a year by moving to the cheapest PPM tariff, and £300 by switching the best deal on the market. The Big Six suppliers - British Gas, SSE, ScottishPower, EDF Energy and E.On - don’t levy a fee but some smaller firms do. Extra Energy, for example, has a £160 fee, said Ofgem. But some big suppliers want sizeable security deposits before they’re take on customers, often those they deem a credit risk. Ofgem found npower wanted £1,364 upfront in one case and E.ON asked for £5,000 in another. Philip Cullum, a partner at Ofgem, said the charges “fall on those least able to afford them.” The findings come ahead of a report from the Competition and Markets Authority, expected next week, which is set to criticise energy suppliers. MIRROR

Amazon stokes row over internet giants' tax bills as it pays just £11.9m in tax on £5.3bn worth of UK sales
The online retailing giant recorded sales up 14 per cent last year. But the group's UK subsidiary reported a profit of just £34.4million and thus incurred a tax bill of £11.9million. The news will fan the flames of the argument over internet giants' tax bills, with firms such as Amazon and Google attacked for booking profits in lower tax countries. Amazon employs more than 7,700 people in the UK and its sales in the country account for 9.4 per cent of its global turnover. But sales in Britain are taken through the group's Luxembourg arm, called Amazon EU Sarl. The Luxembourg business is where sales from many countries in Europe are booked and are not taxed in the country where the shopper carried out the transaction. In April Chancellor George Osborne said firms that move their profits overseas to avoid tax will be subject to a 'diverted profits tax'. The so-called 'Google Tax' is designed to discourage large companies from diverting profits out of the UK to avoid tax. Firms such as Apple, Google and Starbucks have all seen their European tax payments criticised for being too low. In October, the European Commission said it would launch a probe to see whether Amazon's tax affairs complied with state aid rules. This investigation follows other probes the EC has launched into the tax affairs of computer giant Apple, coffee chain Starbucks, and the financial arm of car maker Fiat. DAILY MAIL

Government shelves multi-billion railways upgrade plan due to rising costs and delays. But HS2 unaffected
In a statement to Parliament Transport Secretary Patrick McLoughlin said he was pausing key parts of the £38.5bn Network Rail upgrade programme. “Much of this work should have been done decades ago – successive governments have failed to invest in our rail network,” he told MPs. Casualties of the announcement include a “pause” on upgrades to the Midland mainline to Sheffield and the Transpennine route between Manchester and Leeds. Some aspects of the announcement appear to undermine George Osborne’s stated goal of creating a “northern powerhouse”, of which improved regional transport links are a large part. But the Government's flagship HS2 scheme appears to be unaffected by the policy change. The Network Rail upgrade plan, launched by the Coalition, was billed as the largest modernisation of the railways since Victorian times”. INDEPENDENT

UK tax policy dictated by companies not ministers says leading treasury advisor
Philip Baker QC is a leading barrister and adviser to the Treasury on its recent “Google tax”, aimed at stopping international companies from avoiding tax. He said: “I don’t think in the last 20 years or so one can say that governments have driven corporation tax policy. It’s the large companies that have driven the direction of corporate tax policy.” He stressed that more coordination was needed between EU member states on tax, such as measures proposed by the European commission last week. Known as the Common Consolidated Corporate Tax Base (CCCTB), these new proposals were set out by commissioner for tax Pierre Moscovici in answer to the LuxLeaks scandal, which last year laid bare the extent to which some smaller EU countries had set their tax policy to routinely facilitate tax avoidance by multinationals, eroding tax receipts beyond their borders. Baker told the tax conference he thought it regrettable that the UK appeared to have immediately rejected such plans out of hand. GUARDIAN

Tesco shareholders attack bosses over staff's 'slave wages' after it emerges taxpayer is topping up employees' incomes
Tesco was condemned yesterday for failing to pay the Living Wage to shop workers while turning failed executives into millionaires. Shareholders said Tesco’s failure to pay the Living Wage – £7.85 an hour, or £9.15 in London – meant the taxpayer had to make up the shortfall through tax credit payments, estimated at £364million last year. Shareholder Michael Mason-Mahon attacked the board to wide applause, saying: ‘You’re a cancer on our society because you keep the poor, poor. This is not right... Slavery was abolished … The new slogan should be “Tesco – we do not pay Living Wage but we do reward our executives for failure and make them multimillionaires”.’ The retired businessman told the AGM in Westminster: ‘What we need is executives who act with honour and integrity’. Former boss Philip Clarke last year departed with a £1.2million lump sum and a pension pot approaching £14million. The firm’s former chief finance officer Laurie McIlwee received £1million and a pension pot of nearly £7million. New chief executive Dave Lewis, brought in to turn the supermarket around, has been paid £4.1million for six months’ work, including a £3.2million ‘golden hello’. Mr Lewis defended staff pay, saying: ‘We start from a place where the salary paid to colleagues in Tesco is the leading figure in the marketplace... We pay 4-7 per cent more than our competitors.’ Amid falling sales, the company is also at the centre of a Serious Fraud Office investigation into allegations trading profits were artificially inflated by £326million. DAILY MAIL

British households still £500 a year worse off than before financial crisis
In its annual assessment of households’ finances, the Office for National Statistics (ONS) said that median disposable – ie after tax – income increased to £24,500 in 2013-14, but still remained £500 a year lower than in 2007-08 once inflation was taken into account. The pain has not been felt evenly, however. The ONS finds that the median disposable income for retired households has increased by 7.3%, or £1,400 a year in real terms, compared with a decline of 5.5%, or £1,600, for non-retired households. This is because pensioner income has partly been protected by the Conservatives’ “triple lock”, which sees the state pension increase in line with the highest rate of inflation, average earnings or 2.5%. The ONS analysis also revealed the different tax contributions made by households at the top and bottom of the income scale. While income tax weighs more heavily on the richest earners, the poorest households tend to spend more of their income, and thus pay a higher proportion of their income in indirect taxes such as VAT. In total, the richest fifth of households paid an average of £29,200 in taxes in 2013-14, compared with £4,900 for the poorest fifth. That accounted for 34.8% of income among the richest fifth, and 37.8% for the poorest. The ONS analysis also compared how much each fifth received in benefits. “The poorest fifth of households received the equivalent of £7,500 per year from all benefits in kind, compared with £5,500 received by the top fifth. This is partly due to households towards the bottom of the income distribution having, on average, a larger number of children in state education,” the ONS said. GUARDIAN

The world is defenceless against the next financial crisis, warns Bank for International Settlements
The world will be unable to fight the next global financial crash as central banks have used up their ammunition trying to tackle the last crises, the Bank for International Settlements (BIS) has warned. The so-called central bank of central banks launched a scathing critique of global monetary policy in its annual report. The BIS claimed that central banks have backed themselves into a corner after repeatedly cutting interest rates to shore up their economies. These low interest rates have in turn fuelled economic booms, encouraging excessive risk taking. Booms have then turned to busts, which policymakers have responded to with even lower rates. Claudio Borio, head of the organisation’s monetary and economic department, said of low interest rates: “Rather than just reflecting the current weakness, they may in part have contributed to it by fuelling costly financial booms and busts and delaying adjustment. The result is too much debt, too little growth and too low interest rates”. Policymakers in the eurozone, Denmark, Sweden and Switzerland have even taken their interest rates below zero in an attempt to support their economies. Jaime Caruana, general manager of the BIS, said that interest rate hikes “should be welcomed”, as global economies have started to grow at close to their historical averages, and a slump in oil prices has provided the global economy with a boost. TELEGRAPH


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