UK Business News Today: 29 June 2026 | Economy, Markets & Insolvencies

UK businesses start the week facing a crowded risk picture: possible tax reform under an expected Andy Burnham premiership, warnings from the FSB over employment costs and late payment reform, weaker export performance, heatwave pressure on the power grid and fragile global markets after an AI-led tech selloff. For SMEs that sell on credit, the key concerns are rising operating costs, policy uncertainty, more cautious customers, tighter margins and the need to monitor payment behaviour closely before cashflow pressure turns into bad debt.

James Salmon, Operations Director.

Key Developments

• Andy Burnham is expected to set out a devolution and economic reform agenda, with tax, regional powers, infrastructure and wealth-related measures all in focus.
• The FSB has urged the next prime minister to back the UK’s 5.7 million small businesses, protect late payment reform and ease employment costs.
• UK food and drink exports fell to their lowest first-quarter level in a decade, with sharp falls in EU and US sales.
• The UK grid operator issued another rare summer power supply warning as heat, low wind and reduced nuclear output tightened reserves.
• Global markets remain unsettled by the AI chip selloff, US-Iran tensions, energy supply risk and hawkish central bank signals.

SME & Business Environment

FSB urges next prime minister to back 5.7 million small businesses

The Federation of Small Businesses has challenged the next prime minister to set out a clear plan for the UK’s 5.7 million small businesses and self-employed. The FSB wants business rates decisions revisited, employment costs eased and late payment legislation protected from being watered down. It has also raised concerns about VAT collection reforms for online platforms, warning that HMRC must not create cashflow advantages for large players at the expense of smaller firms. The organisation also called for action on youth unemployment, including lower employer taxes on jobs and faster support for under-25s on Universal Credit.

Why it matters: Smaller businesses need confidence that policy changes will not increase costs, weaken cashflow or make it harder to collect payment from larger customers.

Bosses unable to pay themselves a living wage

The FSB has warned that rising employment costs and minimum wage increases are putting small business owners under personal financial pressure. In its submission to the Low Pay Commission, the group said many owners are absorbing higher costs themselves, leaving some unable to pay themselves a living wage. The pressure is also influencing closure decisions and retirement planning. For firms with already tight margins, higher wage costs can quickly reduce working capital.

Why it matters: When owners absorb rising costs personally, the business may appear to keep trading normally while underlying cashflow resilience weakens.

Job vacancies rise but graduates face tougher market

Adzuna reports that UK job vacancies have risen for four consecutive months to nearly 800,000. However, graduate vacancies fell by more than 40% year-on-year in May, the largest fall on record. The Resolution Foundation has warned that the number of young people not in employment, education or training now exceeds 1m. It argues that targeted subsidies such as youth jobs grants may be more effective than broad tax breaks in encouraging firms to hire younger workers.

City of London offers support to next prime minister

Chris Hayward, policy chairman of the City of London Corporation, has written that the Square Mile remains committed to supporting UK growth despite political uncertainty. He highlighted the need for clearer pathways into work and stronger financial resilience, noting that nearly a quarter of UK employees lack emergency savings. Hayward called for regulatory and policy reforms that allow financial services to support growth both inside and outside London. The message is a direct attempt to position the City as part of the next government’s economic solution.

Economy & Policy

Burnham to outline economic reform plans

Andy Burnham is expected to set out his economic plans this week, with fiscal devolution central to the agenda. His proposals are expected to include greater tax-raising powers for local authorities and a stronger focus on regional economic growth. He is also said to be interested in mutualising key sectors such as utilities. The plans are likely to shape business expectations around future tax, infrastructure and investment policy.

Burnham plans transfer of power out of Whitehall

Burnham is expected to unveil a ten-year strategy for transferring power out of Whitehall. The plan is expected to focus on regional infrastructure, education and financial powers for the North, with a promise of “good growth in every postcode.” Some proposals could include new taxes on property and capital gains, which critics say may fall more heavily on better-off households in the South. Opposition leaders have questioned whether Burnham has a sufficient mandate and say he should explain his plans to Parliament.

Burnham could devolve tax collection

Lord Jim O’Neill, a former economic adviser to Burnham, has said devolving taxes is “definitely something” that could be studied seriously. Business rates and income tax have both been identified as possible areas for regional control. Such a change would represent a major shift in how England funds public services and economic development. It could also introduce regional variation into business costs.

Taxing times for next prime minister

Financial experts say a Burnham-led government could prioritise a wide review of tax policy. Potential areas include the frozen £12,570 personal allowance, business rates, council tax, stamp duty, wealth taxes and inheritance tax. The frozen personal allowance has already drawn attention because rising state pensions are bringing more pensioners into tax. Burnham has previously supported higher wealth taxes and suggested inheritance tax should be scrapped.

Haldane calls for tax reforms

Andy Haldane, president of the British Chambers of Commerce and former Bank of England chief economist, has called for a major overhaul of the UK tax system. He argued for reforming or replacing taxes such as stamp duty and council tax with more growth-friendly alternatives, including land value taxes. Haldane also warned that raising capital gains tax too aggressively could damage investment. His comments add weight to calls for long-term structural reform rather than short-term revenue fixes.

Haigh backs CGT overhaul and borrowing boost

MP Louise Haigh has called for capital gains tax to be aligned more closely with income tax, the end of the CGT uplift on inherited assets and the replacement of stamp duty with an annual property and land tax. She has also backed relaxing fiscal rules to allow greater borrowing through the National Wealth Fund and proposed splitting the Treasury into separate spending and growth departments. As an ally of Burnham, and tipped for a senior Cabinet role, her proposals have fuelled expectations of higher taxes and more borrowing. Burnham has previously said he would stick to Rachel Reeves’ fiscal rules, which require day-to-day spending to be matched by tax revenues.

Wealth taxes would be ‘huge blow’ for Britain

Business groups have warned that potential wealth tax reforms under Burnham could damage the UK’s attractiveness to entrepreneurs and investors. Allies are reportedly pushing for capital gains tax to rise from 24% to as much as 45%, alongside a possible exit tax on departing investors. Critics including The Entrepreneurs Network say this could deter international talent, encourage existing business owners to leave and make rival investment hubs more attractive. The debate is likely to become a key test of the next government’s growth agenda.

Unlocking pension funds could boost growth

Burnham is being urged to access a reported £150bn surplus in local government pension funds to support local economies without raising taxes or borrowing. The Local Government Pension Scheme received £13bn in contributions during 2024/25. Former pensions minister Ros Altmann argued that some local authorities are paying large sums into pension funds that may not need the money while struggling to fund local services. Supporters say the surplus could be redirected toward productive local investment.

Government split over new golden visa scheme

The Government is considering reviving a £5m golden visa route to attract wealthy investors and talent. The proposal would offer fast-track citizenship to super-rich investors, but it faces resistance over money-laundering risks and doubts about whether similar schemes deliver meaningful growth. The debate reflects wider concern about how the UK attracts capital while maintaining public trust. It also sits alongside wider discussions about wealth taxation and investor confidence.

Tax & Government

Trump threatens 100% tariffs over digital services taxes

President Donald Trump has threatened 100% tariffs on imports from countries that impose taxes on US digital services. His comments were aimed particularly at European nations discussing such taxes, and he said the new tariff approach would override existing trade agreements. The UK’s 2% Digital Services Tax, introduced in 2020, applies to large digital groups including Apple, Google, Meta and Amazon. It raised about £800m in 2024/25, up from £678m the previous year.

Green tax raises £20bn from energy-intensive firms

The UK Emissions Trading Scheme has raised more than £20bn from energy-intensive businesses since 2021. Firms paid £2.7bn last year alone, on top of £17.8bn since the scheme began. Industry groups say only a small fraction of the money is being returned to help businesses decarbonise. UK Steel has called for green taxes on imports to be overhauled so overseas producers selling into Britain face equivalent costs.

Brexit making inflation harder to control, says Huw Pill

Bank of England chief economist Huw Pill has said Brexit has made UK inflation harder to control. He pointed to post-Brexit trade barriers and labour market changes, arguing that the UK economy is now more prone to “self-sustaining momentum” in price pressures. This suggests structural changes may have made inflation more persistent than in comparable economies. For businesses, that means cost pressure may remain stubborn even when headline inflation improves.

Industry & Investment

UK food exports slide to decade low in Q1

UK food and drink exports fell to their lowest first-quarter level in a decade, according to the Food and Drink Federation. Exports dropped 4.8% year-on-year to £5.7bn, while volumes fell 8.9%. EU exports were down 6.9%, with the FDF blaming Brexit-related costs and complexity, while exports to the US fell 28% amid tariffs imposed by President Trump. FDF chief executive Karen Betts said the Government could do more to improve competitiveness, including helping firms access trade deals and lowering the cost of doing business.

UK grid operator issues second summer power supply warning

The National Energy System Operator issued a second power supply warning for Friday evening as soaring temperatures across Europe increased demand for cooling. The warning reflected an estimated reserve margin shortfall, with generators and suppliers asked to make additional capacity available. Such warnings are unusual in summer and were driven by higher cooling demand, low wind generation and reduced nuclear output. Energy reliability has become a growing concern during extreme weather.

Heatwave prompts workplace shorts debate

More than 60% of British adults believe it is acceptable to wear shorts at work during hot weather, according to Ipsos. Employers are taking different approaches: JPMorgan prohibits shorts and casual wear, Citibank asks staff to dress professionally while allowing self-expression, and PwC operates a “dress for your day” policy. Greg Jackson of Octopus Energy said he has never found a link between clothing and performance. The story reflects how businesses are adapting workplace norms during extreme heat.

BT and Verizon agree international enterprise joint venture

BT has agreed to form a 50:50 joint venture with Verizon Communications, combining their international enterprise businesses. The new venture is expected to serve more than 3,000 customers across more than 180 countries, representing about $4bn in combined annual revenue. BT said the enlarged business will combine international networks and enterprise capabilities to support global connectivity and communications services. The companies expect scale efficiencies across network infrastructure and service operations.

UK leads Europe in activist investor campaigns

The UK accounted for 42% of activist investor campaigns in Europe this year, according to Alvarez & Marsal. The report recorded 78 campaigns, a 12% increase from last year. Not all campaigns were public, but companies that engaged with activist investors saw 7.3% higher shareholder returns. A&M’s André Medeiros cautioned that it remains to be seen whether those effects last over the longer term.

AI boom risks investment bust, BIS warns

The Bank for International Settlements has warned that heavy AI investment by major technology companies could trigger an investment bust if returns fail to meet expectations. The BIS also pointed to record public debt, stubborn inflation, fragile government bond markets and risks in non-bank financial firms. The warning comes after a sharp selloff in AI-related semiconductor shares. It adds to concerns that markets may have become too dependent on optimistic AI assumptions.

Tech rout exposes risks in speculative AI trades

Last week’s selloff in AI chip stocks exposed the speed at which modern speculative trades can reverse. Leveraged ETFs, digital-asset derivatives and retail trading products have made it easier for investors to take concentrated positions in complex companies. The same machinery that amplified the boom can amplify losses when sentiment turns. Smaller investors may be particularly exposed when market fundamentals reassert themselves.

Samsung and SK Hynix shares fall despite chip investment plans

Shares in Samsung Electronics and SK Hynix fell amid expectations that the South Korean semiconductor firms would announce investments worth 2 quadrillion won, or about $1.3trn, over the next decade. Local media said the money would support new chipmaking plants and data centres. The firms dominate the market for high-bandwidth memory chips used in artificial intelligence models. The share price reaction suggests investors are questioning the cost and timing of major AI-related capital expenditure.

Anthropic AI model access restricted

The Trump administration allowed Anthropic to release Mythos 5, one of its latest AI models, to around 100 trusted partners including companies and government agencies. It then told the AI lab to prevent foreigners using its most powerful models, prompting Anthropic to block access. Fable 5, another “Mythos-class” model, remains unavailable. The move points to growing geopolitical control over advanced AI technology.

Retail, Housing & Consumers

First-time buyers over 50 rise 43%

FCA data shows that mortgages taken out by first-time buyers aged 51 and over rose from 5,511 in 2020 to 7,865 in 2024, a 43% increase. In total, 55,639 homes were purchased by this age group over the period. Richard Dana of Tembo said the rise is not a lifestyle choice but a result of affordability pressures. The figures underline how housing costs are reshaping household finances later in life.

Bulk sales surge in London housing market

More than a third of new homes originally intended for private sale in London were bought in bulk last year, up from 25% the previous year. Experts say this reflects the affordability crisis, with developers turning to housing associations and investors as demand from owner-occupiers weakens. The shift suggests that households are struggling to absorb new housing supply at current prices. It also highlights pressure on developers’ cashflow and sales pipelines.

Gen Z relying on inheritance for retirement

Standard Life research shows that 23% of Gen Z adults are not prioritising retirement savings and are instead relying on parental inheritance. At the same time, 15% of parents plan to spend their savings rather than leave an inheritance. Mike Ambery of Standard Life warned that relying on inheritance is risky given rising living costs. New inheritance tax rules from 2027 may add further complexity to family financial planning.

International & Trade

UK economy faces ongoing pressure, says CBI

The CBI says the UK economy remains under significant pressure and that firms expect activity to decline in the three months to September. Business pessimism has continued from late 2024. The warning adds to evidence that firms remain cautious despite some areas of resilience in the labour market. It also comes against a backdrop of tax uncertainty, energy pressure and weak export performance.

World Cup enters knockout phase

After 72 group-stage matches, the World Cup has entered the knockout phase. Canada defeated South Africa with a late winner in the first round-of-32 match and will next face either the Netherlands or Morocco. Brazil play Japan, while Germany face Paraguay in the day’s other ties. The tournament remains a positive footfall opportunity for hospitality, retail and food businesses, though benefits will vary by location and trading model.

Global Market Summary

The market backdrop remains fragile after a week dominated by the AI and semiconductor selloff, volatile energy markets and renewed central bank concerns. The uploaded market wrap showed the S&P 500 down about 2% over the week and the Nasdaq Composite down about 4.6%, while the Dow Jones Industrial Average rose 0.6%. It also recorded major hedge fund selling of global IT and communication services stocks, a rebound in parts of Asia, and a relief move in US futures after the US and Iran agreed to stand down ahead of further talks.

Equity markets

• FTSE 100: 10,515 in early Monday trade. UK sentiment was affected by heatwave disruption, including airport delays and cancellations, but the main market themes were global rather than domestic.
• STOXX Europe 600: the index finished the week broadly flat and remained near record territory, helped by lower oil but held back by semiconductor weakness.
• STOXX Europe 50 / Euro Stoxx 50: 6,235, little changed.
• DAX: 24,728 in early trade. Sentiment was affected by reports that Volkswagen may be weighing deeper job cuts amid Chinese competition.
• CAC 40: 8,373 in early trade, also little changed against the wider European backdrop.
• S&P 500: S&P 500 futures were around 7,447, up roughly 0.6% to 0.7% versus Friday. The cash index fell about 2% over the previous week.
• Dow Jones Industrial Average the Dow gained 0.6% over the week, outperforming the broader US market.
• Nasdaq: Nasdaq 100 futures were 29,712, up 1.1% versus Friday. The Nasdaq Composite fell about 4.6% over the week as AI and chip stocks came under pressure.
• Nikkei 225: 69,468, up 0.2%, reversing an earlier 2% loss as Asian tech sentiment recovered.
• Hang Seng: 23,027, up 1.6%, helped by bargain-hunting in technology shares.

Market drivers

The biggest market driver was the AI valuation reset. Last week’s “chip wreck” saw investors rotate out of semiconductor and AI names, with leveraged products and retail speculation adding to the speed of the move. That matters for business owners because falling equity confidence can make investors more cautious, raise funding scrutiny and reduce appetite for riskier growth spending.

Energy and geopolitics were the second major theme. The weekend saw escalation around the Strait of Hormuz, including attacks on vessels and reduced commercial traffic, followed by a partial stand-down between the US and Iran. Markets welcomed the de-escalation, but oil, gas and shipping risks remain live. For UK SMEs, that keeps energy and transport costs vulnerable to sudden moves.

Central banks also remain a constraint. US PCE inflation was reported at 4.1% year-on-year in May, while Federal Reserve officials warned that rates may need to rise further. In Europe, ECB officials remain divided between patience and further tightening. In the UK, Huw Pill’s comments about inflation persistence add to the sense that borrowing costs may remain restrictive for longer.

Currencies

• GBP/USD: 1.3210. Sterling slipped about 0.2% last week and printed fresh year-to-date lows before rebounding.
• GBP/EUR: EUR/GBP was 0.8630, meaning GBP/EUR was approximately 1.159. The pair was broadly stable.
• EUR/USD: 1.1400, down about 0.8% last week and near a one-year low.
• USD/JPY: 161.84, close to multi-decade highs as the yen remained under pressure.

The dollar remains the dominant force in currency markets. A stronger dollar can increase import costs for UK firms buying dollar-priced goods, energy or technology services. Sterling weakness can support exporters in theory, but for SMEs already dealing with trade friction, tariffs and higher input costs, the benefit may be limited.

Commodities

• Brent crude: $72.54 per barrel. Oil pared early gains after the US-Iran stand-down but remained volatile because of Hormuz risks.
• WTI crude: $70.08 per barrel, close to the pre-war baseline level but still sensitive to supply disruption.
• Gold: $4,064 per ounce. Gold pulled back after safe-haven demand eased, though it remains historically elevated.
• European natural gas: Rose as much as 3% on Monday due to residual Hormuz supply concerns.

For SMEs, the commodity story is practical rather than abstract. Higher oil and gas prices can feed into delivery costs, supplier prices, utilities and inflation expectations. If customers face the same pressures, payment behaviour may deteriorate.

9. Insolvency Watch

Administrations (3)

• LH REALISATIONS LTD
• ONYX GROUP INTERNATIONAL LTD
• W.I.S.E. UNDERWRITING AGENCY LIMITED

Liquidations (28)

• 3 D INTERIORS LIMITED
• BAVARIAN SKY UK 5 PLC
• BLUE PALETTE PRODUCTIONS LIMITED
• BOSLAN ENGINEERING LIMITED
• BRASS NO.10 MORTGAGE HOLDINGS LIMITED
• BRASS NO.10 PLC
• BRASS NO.9 MORTGAGE HOLDINGS LIMITED
• BRASS NO.9 PLC
• CLUMPY LIMITED
• DIGITAL DETOX LTD
• DIGITAL DETOX VENTURES LIMITED
• GARFORTH PANEL BEATERS LIMITED
• GLOBAL STRUCTURE SERVICE LIMITED
• GOLDTHORN MARKETING LIMITED
• HIDDEN BADGER LIMITED
• JOST INVESTMENTS LTD
• LAKEVIEW COMMERCIAL FOUR LIMITED
• LAKEVIEW HOMES FOUR LIMITED
• LAKEVIEW MANAGEMENT FOUR LIMITED
• LAKEVIEW PROPERTIES FOUR LIMITED
• LAKEVIEW SERVICES FOUR LIMITED
• MJB PROPERTIES ONE LIMITED
• MJB PROPERTIES TWO LIMITED
• POLI-CHROME ENGINEERS (MOULDS) LIMITED
• SHEPRETH DEVELOPMENT LTD
• SIGPROC LTD
• SOUTHCOURT LTD
• VCP VII B SPV LIMITED

Winding-up Petitions (1)

• INDIGOSCOTT GROUP LIMITED

Winding-up Orders (8)

• APT RENOVATION LTD
• ASILE VENTURES LTD
• HOME IMPROVEMENT MARKETING LTD
• L.P.D BUILDING & PLASTERING LIMITED
• MD CONTRACT FLOORING LIMITED
• REDSTONE MANUFACTURING SERVICES LTD
• SUMMIT GROUP CIVILS LTD
• TASK LIGHTING LTD

10. Keeping cash moving through policy and cost uncertainty

Today’s news points to a difficult mix for SMEs: tax uncertainty, employment cost pressure, export weakness, energy risk and fragile customer confidence. In that environment, credit control cannot be treated as an afterthought. Businesses that sell on credit need to know who they are trading with, monitor changes in customer risk and act early when invoices fall overdue.

CPA supports businesses with CreditCare credit reports, debtor monitoring, overdue account recovery and practical credit control support. The aim is not aggressive collection, but ethical, professional payment improvement that protects cashflow while preserving customer relationships. When costs are rising and policy direction is unclear, stronger payment discipline can make the difference between profit on paper and cash in the bank.

Call CPA on 020 8846 0000 during business hours, Monday to Friday, 9am to 5pm.
Email PaidQuick@cpa.co.uk
Visit https://cpa.co.uk/contact-us/

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.

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