News Headlines: Sunday 5th January

Personal Finance

David Cameron has announced a cash boost for pensioners, and has hinted at future tax cuts for middle and top earners, by pledging to extend rises to the state pension to at least 2020. In what he describes as a ‘huge’ pledge to help give people ‘dignity’ in old age, he has promised to maintain ‘triple lock’ pension rises for the duration of the next parliament if he is re-elected in 2015 – each year state pensions will rise by whichever is the highest of inflation or average earnings, or by a minimum of 2.5%. In an interview with the Sunday Times, Cameron hinted to the paper that he also wanted to cut taxes for all workers, and further reduce the top rate of 45p. (The Sunday Times p.1, p.4, The Sunday Telegraph p.1)

Property

In the Sunday Express, Andrea Watson reports on the ‘homes of the future’ – in an article looking at forecasts for the property market. A Cluttons report recently found that house prices in London are now 14% above their 2007 peak, which Watson put down to housing shortages, immigration and the Olympic effect. Cluttons say that the areas most likely to see above average house price inflation in the coming year include commuter towns and university cities in the Home Counties. Watson goes on to quote several property experts, including David Newnes of LSL and Peter Rollings of Marsh and Parsons. She reports that the Government is “between a rock and a hard place on tax because driving away wealthy foreigners could hit the market, but not acting will hand the Opposition a trump card for the 2015 election.” (The Sunday Express p.74, p.77)

Economics

After a review of its offshore structure by the HMRC, Google is the first internet giant to be hit with a multi-million pound tax charge. The firm is expected to be charged at least £24m in backdated tax, relating to US shares which were given to employees in Google’s London office, but billed to the company’s Irish subsidiary in order to reduce corporation tax repayments to the UK. Other companies under scrutiny by the HMRC include Apple, Amazon and Facebook. In total the four American giants have avoided up to £1bn a year in tax in Britain, according to analysis by The Sunday Times. The four companies have a combined turnover of £16.6bn, but they paid just £14m of UK corporation tax in 2012, whilst Apple and Facebook paid nothing. (The Sunday Times p.8)

Recruitment

Today is ‘Massive Monday’ – the day we switch jobs. The first Monday back after the New Year is the most popular day to look for a new job, according to the Sunday Times. One in four of us will change careers during our life, with 33 the optimum age for reinvention is. People in their twenties and thirties are the most likely to switch, and they are also the best at it: 62% of those in their twenties and thirties are aware of the cost of changing jobs, and put a plan in place, while only 48% of people aged 30-49 and 40% of people over 50 are prepared. (The Sunday Times p.14)