Business news 30 April 2025
US trade, accepting cash, the dollars slump, food inflation, business rates, MTD, British Steel, Net Zero, house prices, pensions, digitization, AI, crypto, markets, insolvencies & more business news that we thought would interest our members.
James Salmon, Operations Director.
Please note: on the 19/3/25 CPA moved after 45 years on King Street, to new offices a couple of miles down the road at Profile West, 950 Great West Road, Brentford, TW8 9ES.
Deal with UK ‘second-order priority’ says Trump
US officials have divided trade negotiations into three phases, prioritising South Korea while placing the UK in either phase two or three. The shift complicates the UK’s efforts to secure a deal by their mid-May deadline, especially as they aim for an agreement with the EU around the same time. Anand Menon, director of UK in a Changing Europe, highlighted the conflict between US demands and EU alignment, stating: “If the Americans say you have to lift the regulations that restrict the access of our goods to your market, that is incompatible with what we need to do to sign a deal with the EU.”
Firms may need to be forced to accept cash
The Treasury Committee has urged the Government to enhance monitoring of cash acceptance, warning that failure to do so could lead to a two-tier society where vulnerable groups are excluded. The report highlights a significant decline in cash usage, dropping from 51% of all payments in 2013 to just 12% in 2023. The committee suggests that if cash acceptance continues to decline without adequate support for those reliant on it, the Treasury may need to mandate cash acceptance in the future.
Dollar’s slump sparks UK concerns
The Bank of England’s Prudential Regulation Authority (PRA) is evaluating the implications of the dollar’s recent decline, which has been exacerbated by President Trump’s tariffs. Sam Woods, head of the PRA, noted: “This has created a bit of a dent… in the way the US is seen both by regulators and investors.” The dollar has experienced a significant drop of approximately 7.7% since April 2, marking its largest two-month decline in 23 years. Woods expressed concerns about the potential for a more fundamental decrease in demand for dollar-denominated assets and highlighted the importance of UK cooperation with the US, despite recent tensions possibly strengthening ties with European allies. The Bank of England maintains substantial dollar reserves to ensure financial stability and is closely monitoring market conditions.
Rising employment costs drive up food inflation to 2.6% in April
Food inflation in the UK surged to 2.6% year on year in April, marking its highest level in nearly a year, according to the British Retail Consortium (BRC). Retailers are facing additional costs, including £5bn from higher Minimum Wage and National Insurance contributions, with another £2bn expected from a new packaging tax in October. Hiring in the retail sector has dropped by 43.11% year-on-year, raising concerns about the impact of the Employment Rights Bill on small businesses.
Greene King pleas for rates relief
Nick Mackenzie, the chief executive of Greene King, has urged the Government to “level the playing field” regarding business rates, as the recent tax rises in October’s budget are projected to cost the company nearly £50m annually. Mackenzie argues that the pub industry has been paying a “disproportionate amount of rates for many years” and called for collaboration with the Government to reform the system by 2026. Labour’s manifesto promises a “fairer system” with lower tax rates for certain properties. Greene King, which operates 2,600 pubs, is also grappling with rising employment costs, estimating an additional £24m due to increased national insurance contributions. Despite a revenue rise of 3.2% to £2.45bn, the company reported a statutory operating loss of £16.4m.
Small businesses brace for MTD upheaval
As the UK prepares for the ‘making tax digital’ (MTD) reforms set to commence in April 2026, many small business owners express significant concerns regarding the financial and operational implications. A survey by FreeAgent revealed that 10% of small business owners are unaware of the new rules, while 21% do not fully understand the requirements. Roan Lavery, CEO of FreeAgent, said: “Making tax digital is the biggest change for UK tax in more than one generation, but we know many small businesses are still apprehensive.” The Federation of Small Businesses (FSB) highlighted that a “sizeable minority” of firms remain unprepared, with rising compliance costs already averaging £4,500 annually.
ONS set to weigh cost of British Steel rescue
The Office for National Statistics (ONS) has initiated an assessment of British Steel’s operational costs following its rescue by the Government, which may impact Chancellor Rachel Reeves’ fiscal targets. Professor Sir Ian Diamond, the UK’s top statistician, indicated that the ONS is evaluating whether British Steel should be classified as a public body with cost estimates provided towards the end of May.
Blair: Politicians ‘terrified’ to admit net zero failure
The Labour party is reeling after Sir Tony Blair said limiting fossil fuel consumption as part of a net zero agenda was “doomed to fail” and the UK Government should focus less on renewables and more on technological solutions such as carbon capture. The former prime minister said it was wrong that people were “being asked to make financial sacrifices and changes in lifestyle when they know that their impact on global emissions is minimal”. Writing in the foreword to a new report from his think tank, the Tony Blair Institute, Sir Tony said: “Political leaders by and large know that the debate has become irrational. But they’re terrified of saying so for fear of being accused of being ‘climate deniers’.” The Guardian cites one Labour MP who said it was an unhelpful intervention that could be interpreted as a direct critique of Starmer and his energy secretary, Ed Miliband.
Markets
Yesterday, in the US the S&P 500 rose 0.58% to 5560.83 and the NASDAQ rose 0.55% to 17461.32. This morning on currencies, the pound is currently worth $1.337 and €1.176. On Commodities, Oil (Brent) is at $63.6 & Gold is at $3279. On the stock markets, the FTSE 100 is currently flat at 8462 and the Eurostoxx 50 is flat at 5165.
Chinese manufacturing slipped back into contraction in April with the index falling from March’s 50.5 to 49.0
With yet another see-saw on tariffs, Donald Trump caved to pressure from American carmakers by signing an executive order to reimburse some levies on imported auto parts and exempt them from additional duties.
Trump also renewed his criticism of Federal Reserve Chairman Jerome Powell and promoted his tariff regime as a cure all for all American ills at an event to mark his 100th day in office.
Ukraine is reportedly ready to sign a natural resources deal with the US in an attempt to strengthen their economic partnership and build Washington support for the war torn nation.
Amazon issued a denial that it planned to show the amount of tariffs separately on the prices of the products it sells through its marketplace. The Trump administration had called reports that Amazon was planning to do so a “hostile and political act”. Products from China, which make up 70% of Amazon’s sale items, face tariffs of 145%.
House prices
UK House Price Growth slowed to 3.4% in April, from 3.9% in March, and house prices decreased on-month by 0.6% to £270,752 from £271,316, according to data from Nationwide. The monthly decrease surpassed the consensus forecast of a 0.1% decline. The monthly index posted 539.3 for April, down from 542.4 in March.
Treasury strong-arms pension funds to invest more in UK assets
Rachel Reeves is set to announce significant changes to pension fund investments, aiming to direct more funds towards UK businesses. However, industry leaders express concerns that this could leave millions of pension savers poorer. The FT reports that pension funds may be required to allocate 10% of their assets to private funds, with half of that in the UK. An industry executive warned: “We have our arms shoved up behind our backs,” indicating pressure from the Treasury to comply. Critics argue that this could lead to lower returns for savers, with one stating: “How can we explain to savers we are putting money into assets which have been proven, over a period of time, to deliver a lower return?” The Chancellor aims to replicate the Canadian model to boost the UK economy and enhance returns for savers.
Ramsden calls for market digitalisation
Dave Ramsden, a Deputy Governor at the Bank of England, has stressed the need for bold action on digitalisation to enhance the UK’s finance sector. Responding to criticism that the Bank’s prescriptive rules were stifling innovation, he called for authorities and the industry to seize “the opportunity to [use] new technology for the next generation of wholesale payments and settlements” adding it would “require bold and clear action”. Ramsden also pointed out the compelling economic case for modernising capital markets, citing potential operational efficiencies of 40% across bond life cycles.
Britain’s digital tax dilemma
Tim Sarson, head of tax policy at KPMG, discusses the potential impact of the UK’s Digital Services Tax (DST) in CityAM amid ongoing trade negotiations with the US. The DST, introduced in 2015, generated £670m in 2023/24 but faces scrutiny as the US government pushes against it. Sarson notes that “when ideas of tax fairness mix with the social imperative to do something about social media, governments are going to be tempted” to maintain such taxes. Despite their controversial nature and limited revenue generation, these taxes are likely to persist in various forms as governments seek to address the challenges posed by tech giants.
UK tax system labelled a ‘lumbering dinosaur’
Sir Geoffrey Clifton-Brown, the chairman of the public accounts committee, has described the UK tax system as a “lumbering dinosaur” that is losing taxpayer trust. A report from the committee revealed that the cost of tax collection rose by £563m in the last parliament, largely due to outdated communication methods, with 70% of correspondence still conducted via post. The reliance on legacy systems has hindered productivity, with compliance work yielding only £1.27m per staff member, down from £1.4m pre-pandemic. Clifton-Brown pointed to the need for HMRC to modernise its systems, saying: “It is time for HMRC to prioritise modernising its own systems so that it is fit to enter the second quarter of the 21st century.” The committee urged HMRC to learn from the Passport Office’s successful digital transformation.
Tax pros embrace AI revolution
Tax professionals have undergone a significant shift in their attitudes towards generative AI, with a recent Thomson Reuters report revealing that 71% now believe in its application to their daily work, up from 52% in 2024. The percentage of firms implementing generative AI has nearly tripled, rising from 8% to 21% year-over-year. Notably, 79% of tax and accounting firms anticipate substantial integration of generative AI by 2027. As one firm noted: “AI is a powerful augment, not a suitable replacement, for human ingenuity.” Despite initial fears, only 9% of professionals view generative AI as a threat to jobs, while 54% see minimal or no threat. However, 70% of firms lack formal policies governing its use, highlighting potential risks as adoption accelerates. Elizabeth Beastrom says in Accounting Today that the integration of AI promises increased efficiency, reduced errors, and enhanced client service, marking a transformative journey for the industry.
ACCA encourages FRC to drive ‘proportionate’ SME audit requirements
The Association of Chartered Certified Accountants is calling on the Financial Reporting Council (FRC) to ensure that audit requirements for SMEs are proportionate, aligning with prevailing international standards. Responding to a consultation from the regulator, the ACCA said the focus of the rules should be on the complexity of an entity rather than on size. Lloyd Powell, head of ACCA Cymru/Wales, said: “The focus of standards should be on complexity rather than size given that an entity may be large in size but still be less complex. By focusing on complexity rather than just size, any initiatives by the FRC to address the scalability issues with the UK ISAs will be likely to help a much larger number of firms and practitioners.”
Equity release market surges
The equity release market in the UK has experienced significant growth, with a 32% increase reported by the Equity Release Council between the first quarter of 2024 and the same period this year. David Forsdyke, head of later life finance at Knight Frank Finance, noted that “older homeowners are borrowing more to cover their cost of living, which has risen sharply in the past five years.” Many homeowners are asset-rich but cash-poor, using equity release to supplement their income or to gift money to family. Changes to inheritance tax regulations are also influencing behaviour, as wealthy homeowners seek to raise funds through equity release for more tax-efficient investments. While equity release allows homeowners to remain in their properties, it can be costly and may reduce the value of assets left to heirs.
Sky News
UK to exempt overseas stablecoin issuers from its crypto rules
Britain is set to regulate crypto exchanges and dealers for the first time, as Chancellor Rachel Reeves announces new draft laws aimed at the crypto-asset industry. The regulations will ensure that “crypto firms with UK customers will also have to meet clear standards on transparency, consumer protection, and operational resilience,” according to the Treasury. Currently, around 12% of British adults own or have owned cryptocurrencies, a significant increase from 4% in 2021. The draft rules would also see stablecoin issuers subject to regulation, but only if the issuers are based in the UK. Further discussions on crypto regulation are planned with US Treasury Secretary Scott Bessent in June. Nick Price, partner at Osborne Clarke in London, said the UK approach “appears more aligned with the US, bringing crypto assets into the existing regulatory perimeter rather than developing bespoke legislation for them”.
Bank of England risks stifling stablecoins
The Bank of England is facing criticism for its stringent regulations that could hinder London’s ambition to become a global hub for stablecoins. According to a report by Innovate Finance, the UK’s potential in the $200bn stablecoin market is jeopardised by the Bank’s holding limits and asset-backing requirements. The report states: “The Bank has tended to view stablecoins as a risk to stability,” which could prevent the UK from becoming a leading market for stablecoin trading. Innovate Finance advocates for the removal of deposit limits and the allowance of interest offerings to customers, suggesting that the Bank should adopt an innovation objective to foster new technologies in payments. The stablecoin market has seen significant growth, now valued at nearly $240bn, and is designed to mitigate volatility by being backed 1:1 with liquid assets.
Complaints to financial services firms fell last year
According to the Financial Conduct Authority (FCA), complaints to financial services firms decreased by 4.3% in the second half of 2024, coming in at 1.78m. The decline may reflect the positive effects of the FCA’s Consumer Duty, which mandates that firms prioritise customer needs in their operations. Hugh Fairclough, partner and head of financial services at RSM UK, said: “Many firms have improved their customer service practices in response, which may now be coming through in today’s (second half of) 2024 complaints data.” The total redress paid also fell by 3.0% to £236m, while the upheld complaints rate remained steady at around 57%. The most complained about products included current accounts, motor and transport, and credit cards, all of which saw a reduction in complaints.
Latest Insolvencies
Petitions to wind up (Companies) – POKHARA PVT LTD
Appointment of Administrator – CARDIUM OUTSOURCING LIMITED
Appointment of Liquidators – CAMBRIAN DRAGON INVESTMENTS LIMITED
Appointment of Liquidators – HOLLYBROOK ESTATES LIMITED
Appointment of Liquidators – CAMBRIAN DRAGON LTD
Appointment of Liquidators – GRAY BROS (HARDWARE) LIMITED
Appointment of Liquidators – MCRF LIMITED
Appointment of Liquidators – MEL C SMILE SPICE LIMITED
Petitions to wind up (Companies) – HILLTOP SCOTLAND FESTIVALS & EVENTS LTD
Petitions to wind up (Companies) – VINICOMBE LTD
Petitions to wind up (Companies) – LIGHT CONNECTIONS (SCOTLAND) LIMITED
Appointment of Administrator – IRIS FASHION LIMITED
Petitions to wind up (Companies) – A & L PRECISION ENGINEERING LIMITED
Petitions to wind up (Companies) – ADDITION CONSTRUCTION LTD
Petitions to wind up (Companies) – ASPIRE LOFT CONVERSIONS LIMITED
Petitions to wind up (Companies) – HARRY CONSTRUCTION LIMITED
Petitions to wind up (Companies) – JNSQ HOLDINGS LIMITED
Appointment of Liquidators – FLOWLINE INSPECTION LTD
Appointment of Liquidators – PLANET RICHES LLP
Petitions to wind up (Companies) – H4 HOUSING & COMMERCIAL LTD
Why you should become a member of CPA!
The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid, since 1914. We have supported our members through all sorts of difficult trading environments. With high interest rates and a struggling economy and elevated insolvencies, our services can help your business navigate these difficult waters.
Unlike other credit management and debt collection companies, we offer a range of services to our members that are all included as part of a fixed annual subscription, tailored to your needs.
Under your annual subscription you will have access to our main services:
- Our Creditcare credit reports provide credit ratings and limits along with a host of detailed information on your potential customers to enable you to trade with confidence and set appropriate credit policies for new customers.
- Our monitoring service will alert you to any significant changes in the status of those customers.
- Our Overdue account recovery service can be used to chase up payment on any invoices to those customers that have not been paid on time. Unlike other debt collection companies, this service directs your customer to pay direct to you and allows you to maintain your goodwill with them, rather than inserting ourselves into your relationship with you customer and insisting they pay CPA instead. Our Overdue account recovery service resolves over 80% of accounts referred to us.
All of the above services and other complimentary services such address verification, are included in your subscription!
And for the small minority of debts not resolved through our Overdue account recovery service, you can refer the debt to our collections department to escalate the late payment collections process.
CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. And we provide credit information so you can monitor and assess your key customers and be warned of any potential risks. CPA has been improving business cash flow for over 100 years, by tackling late payers and campaigning against the late payment culture in the UK.
Unlike other credit management companies, we offer our members a fixed annual subscription regardless of how high the value of their debts maybe!
Rather than to borrowing more money to improve your cashflow, CPA suggests that business owners tackle the problem at its source. If late payments are a strain on your cashflow, then talk to CPA about how we can help you reduce those late payments.
Just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email nsm@cpa.co.uk today.
When you see your money come in, you will be so glad you used CPA.
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections
Do you have a commercial late payer that is causing you grief? Use CPA’s no-win, no-fee, commercial debt recovery service!
If you have a particular business customer who is late paying and causing you sleepless nights, why not offer it to CPA’s collection department for purchase on recourse?
CPA’s collection department will then pursue the debt. We will be liable for any costs incurred and then when we have recovered the debt, we will pay you the net principle debt recovered less our percentage.
Once you have enjoyed that success then you can consider the more cost effective membership which includes our Overdue Account Recovery service and Status/Credit reports as well as a range of other complimentary services.
Just call 020 8846 0000 and ask for Godfrey Nelson or Cris Shirley (business hours) or email debtpurchase@cpa.co.uk today.
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.
Get compensated for previous late payments
Have you been paid late by business customers in the last six years?
Maybe you no longer work with them. Under legislation, you are entitled to compensation you for those late payments you have suffered.
You put up with the PAIN – now claim the GAIN!
Claim late payment compensation (LPC) from former business customers who paid you late in the last six years!
CPA (LPC) Recoveries is using our bespoke software and decades of experience to do just that for our clients
Check our compensation calculator to see how much your business could be owed!
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