Business news 30 June 2025
Energy debts pass £4bn. British firms boosted as G7 confirms US tax agreement. Business outlook remains uncertain. Tax, Cyber attacks, the welfare u-turn, the economy, markets, insolvencies & more business news that we thought would interest our members.
James Salmon, Operations Director.
Energy debts pass £4bn
Household energy debts in the UK have surpassed £4bn for the first time, climbing to £4.15bn in early 2025 from £3.85bn at the end of 2024, according to Ofgem. This surge, which has seen debt quadruple since 2018, is driven by rising gas prices and green levies, disproportionately affecting poorer households. Analysts have warned that the growing debt threatens energy suppliers’ financial stability, especially smaller firms. Ofgem is reviewing solutions, including potentially writing off debts for low-income households. However, this would require recovering costs from other sources, possibly through higher bills for other households or levies on energy suppliers.
British firms boosted as G7 confirms US tax agreement
The US and the G7 have agreed on a proposal to exempt US companies from parts of an existing global tax agreement. This comes after the US removed Section 899 – a proposed retaliatory tax from President Trump’s tax bill – which had threatened higher taxes for foreign companies and undermined global tax co-operation. The G7 has created a “side-by-side” system that acknowledges US tax laws while preserving international efforts against tax avoidance. The UK has supported the change, saying it brings more certainty for British businesses, which had feared substantial tax hikes under Section 899. Chancellor Rachel Reeves said the agreement “provides much-needed certainty and stability for those businesses after they had raised their concerns,” adding: “The G7 agrees there is work to be done in tackling aggressive tax planning and avoidance and ensuring a level playing field. The right environment for this to happen is without the prospect of retaliatory taxation hanging over these talks, so the removal of Section 899 is welcome.” Rain Newton-Smith, the chief executive of the Confederation of British Industry, said: “The US commitment to drop retaliatory tax measures … removes a major source of uncertainty for UK-headquartered multinationals.”
Business outlook remains uncertain
The outlook for British business is mixed, with the Confederation of British Industry’s (CBI) latest growth indicator revealing that private sector companies anticipate a decline in activity over the next quarter. Alpesh Paleja, deputy chief economist at the CBI, said: “While negative expectations for activity have eased a little, our surveys still point to challenging conditions for businesses.” In contrast, the latest business barometer from Lloyds indicates economic optimism has reached a ten-month high, with increased hiring intentions and wage growth expectations. Despite this, businesses are grappling with rising employment costs, cautious consumer spending, and global uncertainties.
Tax policy has hurt business confidence
Andy Haldane, a former Bank of England chief economist, says Chancellor Rachel Reeves’ policies, especially the increase in employers’ National Insurance, have dented the confidence of British businesses. He also argues that the Chancellor’s non-dom policy should be refined or reversed as it will lead to net fiscal losses for the Treasury. Mr Haldane, who describes the tax code as “onerous,” also believes that the Bank’s Monetary Policy Committee should have started to cut the base rate sooner, saying: “The economy has been crabbing sideways for at least three years, and lower rates would have cut households some slack.”
Cyber-attacks surge among UK firms
According to a recent report by the Royal Institution of Chartered Surveyors, over 27% of UK businesses experienced a cyber-attack in the past year, a significant increase from 16% the previous year. The report highlights that 73% of business leaders anticipate a cybersecurity incident will disrupt their operations within the next two years. The report also warns that many firms may be using outdated software, while highlighting that as cybercriminals become more sophisticated, the risks associated with operational technology, including building management systems and IoT devices, are increasing.
Industrial firms face fresh tax burden
Around 4,300 large-scale industrial properties in England will face a new business rates levy, costing approximately £685m annually, according to tax and software firm Ryan. This levy, effective from next April, is part of the upcoming business rates revaluation and aims to fund tax breaks for high street retail, leisure, and hospitality sectors. Alex Probyn, practice leader of property tax at Ryan, said that while a move to reduce energy bills was welcome, “it’s perverse to then ask those very same businesses to foot the bill for high street tax cuts through higher business rates from 2026, a year before the energy support will come into effect.” Mr Probyn has emphasised the need for a coherent strategy that addresses the total burden of fixed costs, rather than one that offers support in one area while imposing costs in another. The Government insists that reforms will create a fairer business rates system, benefiting over 280,000 properties in retail and hospitality
Welfare U-turn could mean tax hikes
The Institute for Fiscal Studies (IFS) has warned that a U-turn on welfare reform will put a dent in Chancellor Rachel Reeves’ fiscal headroom, saying a series of concessions is set to cost the Government at least £1.5bn. The IFS also said the decision to ensure that recipients of the health element of universal credit have their incomes fully protected could add an extra £700m to overall spending in 2029/30. Eduin Latimer, senior research Economist at the IFS, said scaling back the proposed changes would “naturally” require ministers to “raise taxes or find other savings elsewhere.” Meanwhile, Ben Caswell, senior economist at the National Institute of Economic and Social Research, expects taxes to go up as “even without savings made on welfare, weak GDP growth and higher than expected borrowing mean that the Chancellor has already fallen short of the £9.9bn headroom anyway.”
Badenoch calls for tax vow
Conservative leader Kemi Badenoch says she will only support Labour’s welfare bill if the Government pledges not to raise taxes in the autumn Budget. She said: “If they can show that they’re going to actually reduce the welfare budget… if they can show they’re going to get people into work… and if they promise no tax rises, then we will support them.”
Hunt ‘made a mistake’ in taxing non-doms
Shadow Business Secretary Andrew Griffith says former Chancellor Jeremy Hunt was wrong to target non-doms as part of efforts to boost tax revenues, saying: “It was a mistake to attack global wealth creators.” While Mr Hunt abolished a special tax status for non-domiciled residents, current Chancelor Rachel Reeves has removed an incentive which allowed assets held in a foreign trust to be free from inheritance tax. Mr Griffith has questioned the move, pointing to Centre for Economics and Business Research analysis suggesting that the Treasury would see heavy losses if a quarter of non-doms left the UK.
More households eye UK exit over tax raids
Following Labour’s election victory, southern European countries have seen a surge in middle-class British families seeking golden visas, with many citing growing frustration over the UK’s rising tax burden. New data shows a sharp increase in applications for residency-by-investment schemes in Greece and Portugal. In Greece, golden visa applications from the UK rose by nearly 47% in the year to April 2025, while Portugal recorded a 66% increase in 2024. Critics warn that Labour’s tax policies, including the scrapping of non-dom status and tighter inheritance tax rules, are driving out not only millionaires but also aspirational younger professionals. While the Treasury maintains that the UK’s tax system remains “fair and progressive,” a report by Henley and Partners has warned that the UK is set to lose 16,500 millionaires in 2025.
Markets
On Friday the FTSE 100 closed up 0.72% at 8798.91 and the Euro Stoxx 50 closed up 1.56% at 5325.64. Over in the US the S&P 500 rose 0.52% to 6173.07 and the NASDAQ also rose 0.52% to 20273.46 as geopolitical tensions continued to ease and as investors welcomed progress on trade talks, with Wall Street pushed up to fresh record highs.
US President Donald Trump confirmed a signed trade deal with China, ending months of talks. The framework will seek to allow rare earth exports and an easing of technology restrictions, according to a statement released by China’s Ministry of Commerce on Friday afternoon. Then Trump called off trade talks with Canada and threatened fresh tariffs after claiming they were going to impose a digital services tax. Canada promptly dropped the plan.
This morning on currencies, the pound is currently worth $1.37 and €1.168. On Commodities, Oil (Brent) is at $67.75 & Gold is at $3283. On the stock markets, the FTSE 100 is currently down 0.26% at 8775 and the Eurostoxx 50 is down 0.25% at 5312.
UK car manufacturers can export to the US under a 10% tariff starting today as the new trade deal comes into effect.
UK GDP expanded 0.7% in the first quarter, 1.3% year on year, according to a final reading, matching estimates.
Economy faces ‘pivotal moment’
Agustín Carstens, general manager of the Bank for International Settlements, has warned that the global economy is at a “pivotal moment” as it enters a “new era of heightened uncertainty and unpredictability.” This, he said, is testing public trust in institutions such as central banks. Mr Carstens, the former governor of Mexico’s central bank, said increasing protectionism and trade fragmentation is “particular concerning” as they were exacerbating a decline in economic and productivity growth, while also voicing concern over evidence that the world economy is becoming less resilient to shocks. Pointing to rising debt levels, Mr Carstens said: “This trend cannot continue.”
FDI projects hit record low
The UK has experienced a significant decline in foreign direct investment (FDI) projects, with the total falling to the lowest level since records began 18 years ago. According to the Department for Business and Trade, there were 1,375 FDI projects by the end of March, a 12% drop from the previous year. This decline raises concerns about job creation and economic growth, as foreign investment is crucial for prosperity. A spokesperson from the Department said the Government “knows the power of inward investment and is laser-focused on targeting the highest-impact job-creating wins across the UK.”
German parliament passes €46bn corporate tax relief package
Germany’s parliament has passed a €46bn package of fiscal relief measures to support companies and boost investment. The measures seek to reduce companies’ tax bills with favourable depreciation options for investments of up to 30% and also pledges a one-percentage-point cut to the corporate tax rate each year over five years from 2028, reducing it to 10% by 2032.
620k company directors are working beyond retirement age
Around one in ten company directors are working past the state retirement age, according to research by Bowmore Financial Planning. The analysis, which is based on Companies House filings, shows that the number of company directors in the UK aged 67 or older has reached 620,000. The data shows that 445,000 company directors are over the age of 70, while 105,000 are over 80. Charles Incledon, client director at Bowmore Financial Planning, said: “Many company directors haven’t yet saved enough for a comfortable retirement. It’s forcing many of them to work longer than they’d ideally like.”
Early retirement sparks £31bn brain drain warning
Analysis from Standard Life’s Centre for the Future of Retirement shows that an average of 437,000 over-50s left the workforce before state retirement age each year between 2019 and 2024. Of these, around half took early retirement, 49,000 left citing health issues and 170,000 quit for other reasons – including care duties and redundancy. The study found that key growth sectors had a higher early retirement rate than the rest of the economy and Patrick Thomson, head of research analysis and policy at the think-tank, said: “The UK’s economic future will be driven by these high-growth sectors, but relies heavily on the experience of over-50s. Yet we’re at risk of letting them slip away.” The analysis suggests that early retirement across Britain’s most important growth sectors is costing the economy £31bn a year.
Home sales surge in May
HMRC data shows that home sales were up 25% in May compared to April, hitting 81,470. While sales were up month-on-month, they were down 12% on May 2024. The increase in May followed a slump in April, with the end of the stamp duty holiday seeing a decline in activity. Richard Donnell, executive director at Zoopla, said data from the property platform indicates that “new sales are being agreed at the fastest rate for four years, as more homes for sale means more buyers in the market, with the stamp duty changes in the distant past in the minds of home buyers.” He added that the market remains on track for 1.15m sales in 2025, which is up 5% on 2024 levels.
Energy firms in merger talks
Scottish Power and Ovo Energy have entered into talks about a possible merger. If the two firms do agree to combine their residential gas and electricity operations, the company would serve more than 6m UK households, making it the third-largest supplier behind Centrica-owned British Gas and Octopus Energy. The discussions, which are at an early stage, are running parallel to a process in which Ovo is exploring the possibility of raising around £300m from the sale of new shares.
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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!
Discover NOW the potential value of late payment compensation hidden in your sales ledger!