Finance chiefs call for ‘clearer' tax policy
UK Chancellor, Rachel Reeves, is facing pressure to provide a 'clearer, more stable tax environment,' when she delivers her growth strategy next month. The Chancellor is once again in the spotlight after a damning report from finance bosses indicated the industry was prepped to support growth ambitions, but structural barriers were holding them back.
Top players in the financial services ecosystem – KPMG, UK Finance and PIMFA (Personal Investment Management & Financial Advice) – said 'potential will remain untapped unless underlying structural challenges' are addressed'. The report said reforms to tax policy posed a 'valuable opportunity' to drive up greater confidence'.
Business confidence sank in the fall out of Reeves' maiden Budget, where taxes were hiked £40bn. The Chancellor's controversial change to employer's national insurance came into effect last month, with rates for firms upped 1.2 per cent to 15 per cent.
Managing director of personal finance at UK Finance, Eric Lendeers, said: 'Investors and firms need stability to make informed decisions and to invest for the future. Mixed signals on taxation only compound the problem.' He added it was crucial to avoid 'knee-jerk reactions' on tax policy.
The Chancellor is facing mounting speculation of another tax hike after it was calculated half of her £9.9bn in fiscal headroom had been wiped out just 48 hours after the Spring Statement.
Chief executive at PIMFA, Liz Field, said: 'Uncertainty surrounding non-dom tax status has driven more capital and talent overseas which impacts UK investment and competitiveness.' Field added: 'Frequent shifts and speculations around issues like tax-free cash, pensions, and ISAs undermine confidence and disrupt financial planning for clients.' Reeves inaugural Financial Services Growth and Competitiveness Strategy is pencilled in for 15 July, where the industry will be anticipating the Chancellor's plans to boost the economy.
Chancellor of the Exchequer Rachel Reeves gives a speech at the Treasury in London, Britain. — Reuters
Partner at KPMG UK, Daniel Barry, said: 'As risk to the UK's finance stability are rising, the government has a significant opportunity to instil greater confidence among sector leaders at a time of great uncertainty and geopolitical volatility.' The report from KPMG, UK Finance and PIMFA compiles views from chief executives and senior leaders across the private bank and wealth management industry, as well as financial advice and related services. The sector holds over £1.6 trillion in assets and bosses said reforms were needed to 'unlock the full potential'.
Field said: 'There's a concern across our sector that without a more stable, proportionate and joined-up policy environment, we risk missing a vital opportunity to unlock investment, drive innovation, and promote greater financial resilience across society.'
A separate issue that is causing concern to firms in the UK is the Employment Rights Bill which is currently progressing through parliament and expected to become law in the coming months. Small business owners would continue hiring new staff despite fears around the government's workers' rights package if it contained a rebate on the overhaul's new sick pay rules.
According to a poll by the Federation of Small Businesses (FSB), 35 per cent of entrepreneurs and small business owners believe that a rebate for their firms over sick pay would make them to employ people currently out of work. The government claims its Employment Rights Bill represents the biggest overhaul of workers' rights in a generation. Other important changes within the package include outlawing 'exploitative' zero-hours contracts and so-called 'fire and rehire' practices.
Under the current package, bosses have to grant staff statutory sick pay from their first day of employment, removing the current waiting period of three days. But small businesses fear the sick pay reform will cost them millions and deter them from taking on new employees.
Of the 92 per cent of FSB members that have concerns about the workers' rights bill, 74 per cent believe they will recruit fewer workers. Executive director of the FSB, Craig Beaumont, said the spending review was an opportunity for the Chancellor to incorporate the sick pay demands of small businesses.
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Observer
3 days ago
- Observer
Finance chiefs call for ‘clearer' tax policy
UK Chancellor, Rachel Reeves, is facing pressure to provide a 'clearer, more stable tax environment,' when she delivers her growth strategy next month. The Chancellor is once again in the spotlight after a damning report from finance bosses indicated the industry was prepped to support growth ambitions, but structural barriers were holding them back. Top players in the financial services ecosystem – KPMG, UK Finance and PIMFA (Personal Investment Management & Financial Advice) – said 'potential will remain untapped unless underlying structural challenges' are addressed'. The report said reforms to tax policy posed a 'valuable opportunity' to drive up greater confidence'. Business confidence sank in the fall out of Reeves' maiden Budget, where taxes were hiked £40bn. The Chancellor's controversial change to employer's national insurance came into effect last month, with rates for firms upped 1.2 per cent to 15 per cent. Managing director of personal finance at UK Finance, Eric Lendeers, said: 'Investors and firms need stability to make informed decisions and to invest for the future. Mixed signals on taxation only compound the problem.' He added it was crucial to avoid 'knee-jerk reactions' on tax policy. The Chancellor is facing mounting speculation of another tax hike after it was calculated half of her £9.9bn in fiscal headroom had been wiped out just 48 hours after the Spring Statement. Chief executive at PIMFA, Liz Field, said: 'Uncertainty surrounding non-dom tax status has driven more capital and talent overseas which impacts UK investment and competitiveness.' Field added: 'Frequent shifts and speculations around issues like tax-free cash, pensions, and ISAs undermine confidence and disrupt financial planning for clients.' Reeves inaugural Financial Services Growth and Competitiveness Strategy is pencilled in for 15 July, where the industry will be anticipating the Chancellor's plans to boost the economy. Chancellor of the Exchequer Rachel Reeves gives a speech at the Treasury in London, Britain. — Reuters Partner at KPMG UK, Daniel Barry, said: 'As risk to the UK's finance stability are rising, the government has a significant opportunity to instil greater confidence among sector leaders at a time of great uncertainty and geopolitical volatility.' The report from KPMG, UK Finance and PIMFA compiles views from chief executives and senior leaders across the private bank and wealth management industry, as well as financial advice and related services. The sector holds over £1.6 trillion in assets and bosses said reforms were needed to 'unlock the full potential'. Field said: 'There's a concern across our sector that without a more stable, proportionate and joined-up policy environment, we risk missing a vital opportunity to unlock investment, drive innovation, and promote greater financial resilience across society.' A separate issue that is causing concern to firms in the UK is the Employment Rights Bill which is currently progressing through parliament and expected to become law in the coming months. Small business owners would continue hiring new staff despite fears around the government's workers' rights package if it contained a rebate on the overhaul's new sick pay rules. According to a poll by the Federation of Small Businesses (FSB), 35 per cent of entrepreneurs and small business owners believe that a rebate for their firms over sick pay would make them to employ people currently out of work. The government claims its Employment Rights Bill represents the biggest overhaul of workers' rights in a generation. Other important changes within the package include outlawing 'exploitative' zero-hours contracts and so-called 'fire and rehire' practices. Under the current package, bosses have to grant staff statutory sick pay from their first day of employment, removing the current waiting period of three days. But small businesses fear the sick pay reform will cost them millions and deter them from taking on new employees. Of the 92 per cent of FSB members that have concerns about the workers' rights bill, 74 per cent believe they will recruit fewer workers. Executive director of the FSB, Craig Beaumont, said the spending review was an opportunity for the Chancellor to incorporate the sick pay demands of small businesses.
Times of Oman
11-06-2025
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India will have its own big four accounting giants, says Piyush Goyal
Bern: India is actively working to establish its own version of the global "Big Four" accounting and consultancy firms, as Commerce and Industry Minister Piyush Goyal expressed confidence that homegrown giants will emerge "very soon." Speaking to reporters in Bern on Monday, Goyal outlined the government's strategy to create large domestic accountancy firms capable of competing with international leaders Deloitte, PwC, Ernst & Young, and KPMG, which currently dominate India's consultancy landscape. "We are trying to create our own Big Four. Earlier, the rules were not friendly - we couldn't have mergers, and our mindset was also different," Goyal explained. "Now, gradually, people are understanding the benefits of partnerships. We will have our big four in India very soon - wait and watch." The minister highlighted a fundamental shift in India's approach to professional services, noting that traditional Indian CA firms previously preferred individual leadership over collaborative partnerships. This cultural change, combined with regulatory reforms, is paving the way for larger, more competitive domestic firms. Goyal emphasised India's commitment to creating a discrimination-free investment environment, positioning the country as an attractive destination for global businesses. "India is such a country where you will never face any discrimination. Total non-discrimination is guaranteed," he stated. He explained that foreign companies investing in India are treated as Indian entities once established, ensuring equal treatment and opportunities. "If you come to India and invest, you become an Indian company. Once you become an Indian company, you will never feel any discrimination." The minister contrasted India's approach with other countries that "create unnecessary barriers and trouble the industries of other countries," emphasising India's open and welcoming investment climate. Goyal positioned free trade agreements as crucial instruments for promoting investment, noting that India's growing reputation as a preferred investment destination is being reinforced through these strategic partnerships. The development of domestic "Big Four" firms represents part of India's broader economic strategy to build world-class professional services capabilities while reducing dependence on foreign consultancy giants. This initiative aligns with the government's vision of creating a more self-reliant and competitive business ecosystem. Earlier in the day, he met the Chairman and Committee Members of the recently established Institute of Chartered Accountants of India (ICAI) Zurich Chapter. "Met the Chairman & Committee Members of the recently established @TheICAI Zurich Chapter. Had a detailed discussion on promoting India's fintech expertise and collaboration opportunities in the BFSI (Banking, Financial Services and Insurance) sector, especially in the innovative startup ecosystem. Friends from the media also joined us for this interaction," Goyal wrote on X. Goyal began his two-day Switzerland visit with an interaction with CEOs of select Swiss companies and prospective investors in India over lunch on Monday.
Observer
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Firms shed more jobs as tax rises start to hurt
Employment levels in the UK deteriorated considerably by the end of the first quarter, official data has suggested, in signs that Chancellor Rachel Reeves £20 billion tax raid on employers has squeezed firms' profits. Figures released by the Office for National Statistics (ONS) revealed that the number of pay-rolled employees fell by 53,000 over the first three months of 2025. The early estimate of payrolled employees for April showed a decrease by 33,000. Signs that inflation may remain sticky in the months ahead were also represented by high levels of annual pay growth, which reached 5.6 per cent in the three months to March. It could increase challenges for interest rate-setters at the Bank of England though wage growth in the three months to March was slightly lower than the 5.7 per cent figures pencilled in by Bloomberg, which polled several economists in the lead-up to the release. It also came in below recent figures showing wage growth was 5.9 per cent in the three months to February. Total pay growth, which includes bonuses, was 5.5 per cent between January and March while unemployment edged up to 4.5 per cent. 'Wage growth slowed slightly in the latest period but remains relatively strong, with public and private sectors now showing little difference,' Liz McKeown, director of economic statistics at the ONS said. 'The broader picture continues to be of the labour market cooling, with the number of payroll falling in the first quarter of the year. The number of job vacancies has also fallen again, with the rate of decline increasing in the last few months.' Institute of Directors policy advisor Alex Hall-Chen said the figures showed the government needed to take 'urgent action' on improving employment levels. 'The business case for hiring has been weakened by a perfect storm of (April's) increased employer national insurance contributions (NIC's) and above-inflation increases to the minimum wage, alongside a wave of measures in the Employment Rights Bill which will make hiring riskier and costlier,' Hall-Chen said. A poll of 31 major retailers has found the Employment Rights Bill, currently still going through parliament, will lead to early job cuts and price rises, in the latest sign the government's legislative agenda risks harming economic growth. The bill introduces sweeping changes to zero-hours contracts, sick pay, leave, flexible working and dismissal, and is set to pile extra costs on employers. The retail sector is already facing significant pressures from high taxes in addition to NIC's which is stifling employment and undermining investment. The British Retail Consortium has now found that major retailers are increasingly concerned about the hits they will suffer from the government's Deputy Leader Angela Rayner's workers' rights reforms. Seven in 10 HR directors at big retailers believe that the workers' rights reforms will have a negative impact on their businesses, according to BRC's survey, highlighting the widespread pessimism about the damage the bill could do in its current form. More than half of respondents also said that the Employment Rights Bill would lead to a reduction in staff members while 61 per cent said it would 'reduce flexibility' in job offerings. The 31 retailers surveyed employ some 500,000 people, the BRC said. Among the proposed changes to employment rights are outlawing 'exploitative' zero-hours contracts and providing guaranteed hours. The BRC said they would limit the number of part-time job offerings which comprise half the sector's workforce. The BRC's chief executive, Helen Dickenson, warned that the changes to the employment rights risked 'putting retail job numbers further into reverse.' She added: 'Those in charge of retail hiring are clear: unless amended, the bill will make it even harder to keep and create jobs and reduce the flexibility that defines many existing retail roles.' The BRC also warned consumers face paying more for items at high street shops as most HR directors said the cost of the bill would have a knock-on effect on the price of goods.
