Tax loopholes uncovered by The Times will be investigated by Parliament, the chairman of the powerful House of Commons Public Accounts Committee will reveal today. Abuses uncovered by a series of articles looking into income tax avoidance “wouldn’t look out of place in a banana republic”, says Margaret Hodge. Writing in this newspaper today, she confirms her committee will demand to know what work the taxman is doing to identify rogue methods and how accountants circumvent the system. Officials from Revenue & Customs face being hauled before MPs to explain what action they are taking, after revelations that thousands of wealthy people in Britain are able to pay as little as 1% income tax using aggressive financial schemes.
Nearly three quarters of shops have sales on as the nightmare combination of bad weather, squeezed budgets and Eurozone fears conspire to keep shoppers at home. Figures from PwC show that 73% of stores were advertising special offers last week, up from 40% for the same week three years ago when the country was in the grip of the first stage of the double-dip recession. It comes as retailers face paying their quarterly rent bills today, a cash strain that in previous quarters has provided the final blow for struggling companies, says The Times.
The Bank of England may be putting the economy at risk by persisting with low interest rates and money printing, according to the world’s central banking supervisor. In its annual report, the Swiss-based Bank for International Settlements (BIS) warned that artificially low rates and inflated asset prices could also be holding back growth by masking lenders’ bad debts and deterring them from cleaning up their balance sheets. “Prolonged and aggressive monetary accommodation may delay the return to a self-sustaining recovery,” BIS said. “It can undermine the perceived need to deal with banks’ impaired assets,” The Telegraph reports.
The ‘virulent’ European crisis could infect the UK and the global economy unless governments take urgent action to tackle their problems, one of the world’s leading financial watchdogs has warned. In its grim diagnosis the Bank for International Settlements (BIS) said the chaos spreading across the single currency block could be a ‘harbinger’ of a global meltdown. It urged leaders to tackle the ‘vicious cycle’ of debt and instability in the banking system that is ‘bedevilling Europe’ and called for a pan-European banking system to restore confidence, The Daily Mail says.
Millions of bank customers face continued uncertainty today after the Royal Bank of Scotland, owner of NatWest, warned that the fallout from its unprecedented software glitch could still interfere with accounts. As the catastrophic IT fiasco at the state-owned bank drags into its sixth day, RBS said last night that it could not guarantee business as usual for its 16.9 million account holders today. Massive system strains after a routine software upgrade sparked a meltdown last Tuesday night means that some customer accounts might not be fully updated, the bank said. Its continued problems come after RBS opened 1,200 branches and called in 7,000 additional staff yesterday — the first time in its history that the bank had opened outlets on a Sunday, The Telegraph reports.
Germany has told Greece to stop asking for more help and get on with implementing the reforms it has already promised as tensions mount before this week’s crucial summit of European Union leaders. In unusually blunt remarks, German finance minister Wolfgang Schaeuble said: “The most important task facing new prime minister [Antonis] Samaras is to enact the programme agreed upon quickly and without further delay instead of asking how much more others can do for Greece.” His comments highlight Germany’s growing impatience with the Eurozone’s problem nations in what is shaping up to be another significant week for the single currency bloc, The Telegraph reports.
Europe´s debt turmoil has forced experts to downgrade forecasts for Scotland’s economic growth amid fears the world is “stumbling deeper into crisis”. Growth in the Scottish economy is now expected to be reduced to a sliver at 0.3% in 2012, down from a previous estimate of 1.1% and lower than the tiny 0.4% growth achieved in 2011, according to accountancy firm Ernst & Young’s Scottish Item Club think-tank. The club warned that large companies are putting off their investment plans and are instead stock-piling cash. Dougie Adams, senior adviser to the Scottish Item Club, warned: “There are fears that the world is stumbling deeper into crisis. The Eurozone dilemma has entered a dangerous new phase, questions are being asked of China’s ability to avoid a property-driven hard landing and the US recovery can be described as lack-lustre at best,” The Scotsman reports.