Sir Keir Starmer and US President Donald Trump have hailed an “historic” trade deal between the UK and the US, which eases some, but not all, of the tariffs imposed by the US last month. The deal will see tariffs on British car exports to the US fall from 27.5% to 10%, for the first 100,000 vehicles per year; the 25% tariffs on steel and aluminium will be removed and the UK’s pharmaceutical industry has been promised “preferential treatment”. British beef farmers will be allowed access to the US market and vice versa, with no reduction in food standards in the UK. Jonathan Reynolds, the Business and Trade Secretary, said the UK would continue trying to reduce the 10% baseline tariff, adding that the agreement did not include any concessions on the digital services tax, online safety laws, or the NHS. More details are being worked out and a separate deal on technology is expected to be agreed at a later date. The Telegraph points out that the deal will give the US the ability to object to Chinese investment in the UK – a clause the Tories said amounted to a “veto” over foreign investment. Unions welcomed the news, but John Denton, Secretary General of the International Chamber of Commerce, said: “The reality is that US tariffs on UK exports remain significantly higher than they were at the start of the year.” This point was echoed by Tory leader Kemi Badenoch, who claimed the UK had been “shafted” by Trump. “When Labour negotiates, Britain loses. We cut our tariffs – America tripled theirs.”

Richard Davies, CEO of Allica Bank, highlights in City AM the urgent need for a revitalised SME finance market in the UK. SMEs, which account for 60% of employment and nearly half of business turnover, are facing a significant lending gap of up to £65bn. Davies notes: “The UK has the lowest investment rate in the G7,” pointing to the importance of addressing this issue to support economic growth. He proposes three key actions: doubling the British Business Bank’s Growth Guarantee Scheme, focusing the Bank of England on SME finance, and enhancing navigation of the finance market for SMEs. The goal is to foster a more dynamic and inclusive economy that benefits all regions.

Smaller businesses are crucial to Scotland’s economy, representing over 98% of the total business population and contributing 42.7% of employment and 27.3% of revenues, according to Scottish Government figures. The British Business Bank’s Small Business Finance Markets report for 2024/25 revealed a 14.2% increase in equity investment volumes for Scotland’s smaller businesses, reaching £407m, significantly outpacing the UK-wide growth of 6.6%. Despite a slight decline in deal numbers, Scotland maintained the second-best performance among UK regions. Susan Nightingale, Director, UK Network, Devolved Nations at the British Business Bank, notes: “The quantity and value of equity deals demonstrates the resilience of Scotland’s smaller business community.” The £150m Investment Fund for Scotland has also committed over £10m to support local firms, indicating a robust financial ecosystem for smaller businesses.

Following a crackdown on non-domiciled individuals, many wealthy residents are contemplating leaving the UK to save on tax. Chancellor Rachel Reeves’ decision to eliminate tax exemptions for non-doms has prompted a significant response, with Michael Anderson, a partner at Joseph Hage Aaronson & Bremen, noting: “I act for some clients that are not non-doms and are leaving the UK.” He expressed surprise at the number of high-earning bankers considering relocation, even temporarily, to mitigate tax liabilities. As inquiries about offshore options surge, Anderson warns that HMRC will closely scrutinise compliance with the statutory residence test, particularly regarding record-keeping of working hours and travel. The Government’s tax changes could lead to a £12.2bn revenue drop if many non-doms exit by 2030.

Writing in City AM, Lord Howard Leigh expresses concern over the Employment Rights Bill, which he believes poses significant risks to small and medium-sized enterprises (SMEs). The Federation of Small Businesses (FSB) warns that the Bill could “wreak havoc on our already fragile economy.” Recent surveys indicate that two-thirds of SMEs may limit hiring, and one-third could reduce staff if the Bill is enacted. The financial burden is projected to cost the economy around £5bn, disproportionately affecting small businesses. Leigh highlights the lack of consultation and the rushed nature of the Bill, urging for a more pragmatic approach to support SMEs, which are vital for economic recovery. He says: “This Bill, in its current form, will only hinder that process.”

The Government is planning to require employers in sectors like engineering, IT, and telecommunications to demonstrate investment in domestic workforce training if they wish to continue hiring workers from abroad. The initiative, outlined in an upcoming white paper, aims to reduce the UK’s high net migration, which recently exceeded 900,000 annually. Companies would need to show efforts such as increasing apprenticeships to justify their reliance on international recruitment. The move comes amid political pressure following recent election gains by Nigel Farage’s Reform party and a review by the migration advisory committee into why these sectors depend on skilled foreign workers. Contrary to reports, the government has denied plans to raise English language requirements for incoming migrants.

FRP Advisory has reported delays in corporate decision-making due to President Trump’s tariff threats on US imports. The restructuring firm noted that “the final quarter of the financial year saw a marked increase in macroeconomic volatility,” which has affected business confidence. Despite these challenges, FRP expects a 19% rise in revenues to £152m for the financial year ending April 30, with adjusted earnings anticipated to increase by 11% to £41m. The number of public companies issuing profit warnings rose by 24% in April, with half attributing their difficulties to tariff threats and US economic disruption. Geoff Rowley, chief executive of FRP, stated that the firm is well-positioned to serve clients amid ongoing uncertainty, with a positive medium-term outlook for their markets.

The Bank of England has reduced the Bank Rate by 25 basis points to 4.25%, marking the second cut this year. Andrew Bailey, governor of the Bank of England, said: “Inflationary pressures have continued to ease, so we’ve been able to cut rates again today.” However, he stressed that the Bank would “need to stick to a gradual and careful approach to further rate cuts” as global trade dynamics played out. The central bank’s forecasters predicted that UK economic growth would weaken slightly over the next two years, but this did not factor in the UK-US trade deal agreed yesterday.

The accountancy sector is undergoing significant transformation, shedding its outdated image as a dull profession, says Jane Hamilton says in the Times. Anna Draper, head of people, culture and purpose at BDO, says: “The old stereotypical bean counter image is long gone.” With the rise of AI and complex global tax regulations, accountancy is attracting top talent eager to embrace new challenges. The demand for skilled accountants is surging, with vacancies up 14% from last year, yet a skills shortage looms, with a predicted shortfall of 60,000 staff by 2050. KPMG is actively promoting apprenticeship schemes to address this gap, while firms like Deloitte are leveraging social media to attract new talent. As the profession evolves, future accountants will need to blend technical skills with strategic insight, positioning themselves as vital contributors to business success.