Chinese investment in the UK has surged to nearly £90bn, with significant stakes acquired in major firms such as BAE Systems and National Grid. Analysis by Argus Vickers reveals that investments from Hong Kong and the Chinese mainland have increased by almost 40% since December 2022. Susan Baldry, managing director of Argus Vickers, said: “Thanks to the UK’s strong transparency laws, we’re able to see that investors from China hold a healthy stake in a broad range of Britain’s largest listed companies.” Concerns are growing regarding the implications of this ownership, particularly in sectors critical to national security. Sir Iain Duncan Smith has called for the UK Government to take action against foreign influence, stating: “We are mad, institutionally mad, because political governments have gone down this dead-end alley of China.”

Almost three-quarters (73%) of manufacturers and logistics companies expect President Trump’s tariffs to hit their finances, according to a survey of 2,000 business leaders by HSBC. The poll shows that 21% of business leaders have postponed investment due to the tariffs, while 14% have taken action to reshape their supply chains and 12% have expanded into other international markets. Stephanie Betant, head of global trade solutions at HSBC UK, said: “While UK businesses broadly acknowledge that tariffs will have some impact, relatively few anticipate severe disruption,” noting that this “underscores the structural advantage of an economy where services – a sector less exposed to tariff-related pressures – play a dominant role.”

Workers in Britain’s financial services receive the biggest bonuses in the industry, according to a survey of 2,500 global workers by jobs platform eFinancialCareers. The analysis shows that the average bonus paid to financial services professionals in the UK rose by almost 26% year-on-year to $148,961 in 2024. In the US, the average bonus for financial workers increased by about 18% to $145,817, while in Europe, payouts rose 19% to $108,522. In the Asia-Pacific region, bonuses were up 22% to $48,880. The increase in the UK came after regulators scrapped a cap on bankers’ payouts that had been put in place after the financial crisis and limited variable pay to twice of the worker’s base salary.

President Donald Trump has threatened tariffs on countries targeting US tech giants with taxes, saying his administration “will act, imposing tariffs and taking such other responsive actions necessary to mitigate the harm to the United States.” This move has reignited tensions between the US and its allies regarding digital service taxes. Countries like France have already implemented such taxes and the EU is considering a digital tax if negotiations with the US fail. UK Trade Secretary Jonathan Reynolds has said that Britain’s digital levy, which currently brings in £800m annually, is not “something that can never change or we can never have a conversation about.” Meanwhile, efforts to impose a global minimum tax on multinational corporations, negotiated under the Organisation for Economic Co-operation and Development, have stalled and Mr Trump is not expected to back the proposals.

Rachel Reeves says she will not target household wealth in the next Budget, vowing that there will be no change to capital gains tax. Amid concern over public finances, experts say the Chancellor will have to resort to higher taxes, lower public spending or changes to the Government’s fiscal rules. Quizzed on whether she will be increasing wealth taxes, Ms Reeves told the Sunday Telegraph: “I’ve been really clear about this on a number of occasions … We’re not interested in a wealth tax.” Ms Reeves was also asked whether she will use an emergency break in her fiscal rules on borrowing that allows for a temporary pause, to which she replied: “We’re not going to be using that emergency break,” adding: “The fiscal rules are non-negotiable and they’ve been absolutely essential for providing that stability that both families and businesses need.”

Paul Johnson, director of the Institute for Fiscal Studies, has suggested that Rachel Reeves should consider raising the basic rate of income tax for the first time in 50 years. Currently set at 20%, an increase could generate significant revenue, with estimates indicating that a one percentage point rise could yield £8bn. However, this move is politically unpopular, as it would leave many workers worse off, with potential losses of up to £749 for those earning £50,000. Experts predict that the Chancellor may need to either raise taxes or cut spending to adhere to her fiscal rules, as Britain’s tax burden is already at a post-war high.

UK businesses are facing increased employment costs this April due to the national living wage rise and higher employers’ national insurance contributions. The national living wage increased from £11.44 to £12.21 per hour for those aged 21 and over, marking a 6.7% rise. Meanwhile, employers’ national insurance contributions rose from 13.8% to 15%, with a lower threshold for contributions. David Smith in the Sunday Times argues that these changes particularly impact sectors employing low-paid workers, such as retail and hospitality. Despite concerns, the Recruitment & Employment Confederation suggests the job market remains resilient, with job postings increasing.

Research from Employment Hero indicates a nearly 10% increase in baby boomers taking on casual roles in hospitality, with over-50s now comprising more than a third of the workforce.

The Serious Fraud Office (SFO) is changing its approach to financial crime, allowing companies to avoid prosecution if they self-report suspected fraud. SFO director Nick Ephgrave warns against “burying your skeletons,” stating that firms that cooperate will be invited to negotiate a deferred prosecution agreement (DPA) unless exceptional circumstances arise. Currently, companies face the risk of criminal conviction even when self-reporting, which discourages them from alerting the SFO. The SFO has secured 13 DPAs since their introduction in the UK in 2014, raising £1.7bn for taxpayers. Ephgrave emphasises that the likelihood of wrongdoing being uncovered is increasing due to various factors, including international cooperation and whistle-blowers. He asserts: “If a corporate self-reports and fully cooperates, it will be invited to negotiate a DPA unless exceptional circumstances apply.” New laws will also facilitate the prosecution of companies for senior managers’ actions.

Rachel Reeves is set to agree a £50bn deal with pension funds that will see an emphasis on buying British assets. A new version of a voluntary code will see retirement providers commit to investing 10% of savers’ money into unlisted assets by 2030, with half of that focused on UK projects. While some pension providers were reportedly reluctant to specify a UK target within the broader 10% commitment, others were said to be prepared to commit as much as 15% to private markets. A Pension Investment Review will be published in the coming weeks, with an aim of consolidating workplace pensions into around 15 mega-funds that the Treasury hopes will reach at least £25bn to £50bn. Officials will also look to force companies contributing to workplace pensions to consider returns as well as fees when choosing retirement funds.

With Chancellor Rachel Reeves set to meet US Treasury Secretary Scott Bessent as the UK looks to agree a deal that would ease the burden of tariffs announced by President Donald Trump, sources are increasingly optimistic that an agreement will be signed in the near future. While Japan and South Korea are considered to be ahead of the UK in the queue for an agreement that would lower the rate of tariffs imposed on goods being exported to the US, a source has suggested that the UK is “near the top” of the list. Meanwhile, a report by Allianz Trade has forecast that the UK will end up with an average tariff rate of 3.6% on goods sent to the US. While this is lower than the current levy of 9.1%, it exceeds the 0.9% rate which was in place before Mr Trump opted for new rates.

Rachel Reeves has said it would be “very foolish” for Britain to pull back on its relationship with China to help secure an improved trade deal with the US. Asked if she was willing to engage less with China to placate US President Donald Trump, the Chancellor said: “Well, China is the second biggest economy in the world, and it would be, I think, very foolish, to not engage. That’s the approach of this Government.” Noting that she was in China earlier this year “as part of an economic and financial dialogue,” Ms Reeves said that officials – alongside figures from HSBC, the London Stock Exchange Group, Standard Chartered, and Prudential – “were there to improve the ability of the UK financial services firms to operate out of China.”

Lawyers have advised non-doms who have left the UK to quit private members’ clubs to ensure that HMRC does not use membership as evidence of ongoing links to the UK.