UKHospitality and the Federation of Small Businesses have called on Angela Rayner to delay her employment rights reforms after the Government’s fiscal watchdog warned they risked job losses and price rises. The Office for Budget Responsibility (OBR) warned that the policies would “likely have material, and probably net negative, economic impacts on employment, prices, and productivity.” Kate Nicholls, the chief executive of UKHospitality, said: “We would like the Government to take some time to get this right, give businesses plenty of notice to implement the changes, and give the economy some time to grow.” Separately, the boss of retailer Next, Lord Simon Wolfson, has also warned that the Labour Government’s flagship employment rights bill risks imposing “a huge burden on employers”. Meanwhile, Ms Rayner is facing a backlash from her own staff as they vote to strike against mandatory office attendance of three days a week. Civil servants are expressing their discontent over “rigid attendance policies” as the Housing Secretary prepares to grant unions more authority.

The Institute for Fiscal Studies has warned that Rachel Reeves may need to freeze tax thresholds and increase capital gains and pension taxes in the Autumn Budget. “There’s a good chance forecasts will deteriorate – if so [the Chancellor] will need to come back for more,” warned Paul Johnson from the IFS. Separately, analysis by Interactive Investor shows that frozen tax bands and higher inflation will cost workers thousands in additional income tax over the next three years. Robert Salter, of Blick Rothenberg, said the combination of frozen thresholds and wider tax rises was a “massive” burden that will “punish” taxpayers. He added: “People are increasingly being perceived as higher earners, and taxed accordingly. They’re losing a larger chunk of any pay increases. It will act as a disincentive to get promoted or do overtime.”

Billionaire steel magnate Lakshmi Mittal is contemplating leaving the UK due to the Government’s crackdown on nondomiciled residents. Having lived in the UK for 30 years, Mittal’s potential departure follows the abolition of the non-dom regime, which previously allowed residents to avoid UK tax on foreign income. A friend noted: “He is exploring his options and will take a final decision over the course of this year.” Mittal, who has a fortune estimated at £14.9bn, owns multiple properties globally, including a lavish home in Kensington Palace Gardens. The move aligns with a trend of wealthy individuals relocating to more tax-friendly jurisdictions, such as the UAE and Switzerland, in response to Labour’s fiscal policies.

HMRC could be given powers to demand more personal information from banks about their account holders as the Treasury looks to crack down on savers who fail to pay the tax they owe on interest. Commenting on the move, Sir David Davis, a former Conservative Cabinet minister, said: “The simple truth is HMRC makes mistakes, and allowing them to step in and arbitrarily take your savings in circumstances where they may well have made a miscalculation is completely unjust and improper.” He added: “The state has, over the last few decades, taken more and more liberties with our privacy and with our data and in general, it hasn’t improved services, it hasn’t improved security, but what it has done is undermine the integrity of people’s lives.”

With the state pension expected to rise by 4.6% next year, new analysis indicates that the number of pensioners paying income tax could rise from 8.5m to 9.2m from next year. Former pensions minister Sir Steve Webb, now of consultancy LCP, said: “The continued freeze on tax-free allowances, coupled with earnings-linked increases to the state pension, means that more and more pensioners are set to pay tax in the coming years. We could easily see another 700,000 pensioners who do not currently pay income tax dragged into the tax net over the next two years.”

Living standards for the poorest half of households in the UK are projected to decline significantly over the next five years, with a potential loss of £500 per household due to benefit cuts and a weak economic outlook, according to the Resolution Foundation. The decline is comparable only to the early 1990s recession and the 2008 financial crisis. Ruth Curtice, chief executive of the Resolution Foundation, said: “The outlook for living standards remains bleak,” highlighting that 10m working-age households are expected to become poorer during this Parliament. The overall impact of tax and benefit changes will reduce incomes for the second poorest fifth of households by 1.5%, the foundation said, while the richest fifth will see a smaller decline of 0.6%. The report calls for transitional protections to mitigate the effects of the cuts.

President Donald Trump’s decision to impose a 25% tariff on imported vehicles has raised significant concerns for the UK car industry. Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders (SMMT), stated that the tariffs could harm both UK and US manufacturers, warning that “this will continue to spur growth” in a negative direction. The UK exported £6.4bn worth of cars to the US in 2023, making it a crucial market. The tariffs are also expected to complicate costs for US car makers, who rely on global supply chains.

Rachel Reeves insists that the UK will not be pressured into abolishing its digital services tax (DST), despite increasing pressure from the US. In a recent statement, the Chancellor said: “We will always set our own tax policy and our own tax rates.” The DST, which imposes a 2% levy on the UK revenues of large digital firms, is projected to generate £800m this year. However, it has become a contentious issue in trade negotiations with the US, with the Trump administration urging amendments or the removal of the tax. Meanwhile, scaling back the DST has already triggered a backlash with Labour’s own ranks with MP Rachael Maskell warning: “This could be the very worst optics: dropping a tax on big tech while announcing welfare cuts.”

The Information Commissioner’s Office (ICO) has imposed a £3m fine on Advanced Computer Software Group due to security failures that resulted in a ransomware attack affecting the NHS. The breach compromised personal data of 79,404 individuals, including sensitive medical records and home access details for 890 patients. The hackers exploited a customer’s account lacking adequate multi-factor authentication. Information Commissioner John Edwards said: “The security measures of Advanced’s subsidiary fell seriously short of what we would expect from an organisation processing such a large volume of sensitive information.”

The UK faces a critical challenge in maintaining its status as a global financial hub, according to a recent study by EY and the City of London Corporation. The report warns that delays in establishing a government-backed digital verification system (DVS) could result in the UK losing out on billions in economic benefits and increasing vulnerability to fraud. The report suggests that a well-designed DVS could unlock approximately £4.8bn in benefits by 2031. While the UK has initiated digital identity pilots, it is lagging behind the US and EU, which have already implemented comprehensive digital ID frameworks.

Eurozone banks are showing resilience but must prepare for potential geopolitical shocks, according to Claudia Buch, the European Central Bank’s supervisory chief. She highlighted the risks of liquidity drying up amid volatile financial markets. Buch said: “A potential deterioration in asset quality and possible economic disruptions caused by geopolitical conflicts or the effects of financial sanctions require heightened attention.” The ECB’s annual report stressed the need for robust governance and risk management systems, as well as preparedness for cybersecurity threats.

Nigel Farage, leader of Reform UK, has criticised diversity, equality, and inclusion (DEI) policies in workplaces, praising the Trump administration for dismantling such initiatives. He said: “I think a woke virus has gone through corporate America and corporate Britain.” Farage explained: “The world is changing… but the idea that in certain groups privileges, not based on merit, but based on skin colour, or sexuality, or whatever is wrong, it doesn’t work.” He was speaking on the topic after reaching a settlement with NatWest over his debanking from the bank’s private arm, Coutts.