After a six-year inquiry into the UK’s social and economic disparities, the Institute for Fiscal Studies has concluded that an annual wealth tax is not the answer to inequality. The think tank said the tax “would penalise savers relative to spenders [and] encouraging individuals to save or invest less than they otherwise would.” The IFS said a one-off wealth tax may theoretically be more appealing than an annual levy, as it should have less effect on long-term incentives to invest in the economy. “The long-term consequences for economic prosperity would need to be carefully weighed against any distributional benefits,” the IFS said, adding: “Fixing existing capital taxes might be both easier and better targeted than introducing an annual wealth tax.”

Changes to inheritance tax may hinder tree planting in the UK, according to a survey by the Country Land and Business Association (CLA), the Confederation of Forest Industries (Confor), and the Royal Forestry Society (RFS). The survey revealed that nearly 60% of woodland owners are less likely to create new woodlands due to tax changes, contradicting government ambitions for woodland creation. The evidence has been submitted to the Treasury and Defra for consideration.

Britain is losing 3.4 pubs and restaurants daily, with over 350 closures in the first quarter of the year, according to a report from NIQ. The hospitality sector faces mounting pressures from rising costs, taxes, and the ongoing Iran war, which threatens to escalate energy prices. Karl Chessell, a director at NIQ, stated: “Soaring costs have taken a heavy toll on hospitality.” The number of licensed premises has dropped by 0.7% in six months, leaving 98,609 sites. Without targeted support, further closures are anticipated throughout 2026.

Analysis by UHY Hacker Young reveals that national insurance bills paid by employers jumped by £28bn or 24% last year after the Chancellor raised the tax rate in her first Budget. “It’s now fairly widely recognised that the level of tax in the UK has got too high,” said Phil Kinzett-Evans, a partner at the firm. “Businesses need to see a sensible economic plan that sees a reduction in the business tax burden.” The Daily Mail notes that since becoming Chancellor in July 2024, Rachel Reeves has imposed £75bn a year of extra tax on UK citizens, with much of it spent on spiralling welfare costs.

Central banks in the G7 are expected to maintain current borrowing costs this week amid rising inflation concerns linked to the ongoing conflict in the Middle East. Analysts predict that the Federal Reserve, Bank of England, and other major banks will issue warnings about the inflationary pressures affecting households and businesses. Wei Yao from Société Générale said: “Another week of no fighting, no deal and no energy flows, another week that pressure on inflation and supply chains continues to build.” The situation remains fluid, with potential interest rate adjustments on the horizon.

The Bank of England is expected to maintain its base rate at 3.75% during its upcoming vote, despite rising inflation linked to the Iran conflict. Economists predict that while some members may advocate for a rate hike to 4%, the majority will support keeping rates steady. Thomas Pugh, chief economist at RSM UK, said: “Signs that the economy is holding up, while inflation is accelerating, makes it more likely that the Bank of England will raise interest rates later this year.”

The Financial Conduct Authority (FCA) is consulting on changes to initial public offering (IPO) rules to reduce complexity and costs. Chief Executive Nikhil Rathi pledged to support the Government’s pro-growth agenda in a letter to Sir Keir Starmer. The FCA aims to lift a seven-day ban on banks publishing research during IPOs, stating it has not achieved its intended goal. Jon Relleen, director of infrastructure and exchanges, supervision, policy and competition at the FCA, commented: “We are committed to reducing friction, supporting growth and ensuring the UK remains a competitive and trusted place for companies to raise capital.”

UK banks, including HSBC, NatWest, and Lloyds, will face new de-banking regulations from today. The rules require banks to provide customers with at least 90 days’ notice before closing accounts, an increase from the previous two-month notice period. Customers will have more time to contest account closures and receive written explanations to facilitate challenges through the Financial Ombudsman Service.

JP Morgan is relocating workers from its Paris office back to London as the bank rethinks its European operations. Despite this, a spokesman for the bank told Bloomberg that it was “committed to our sizeable operations on the Continent for the long term.” JP Morgan has more than 1,000 staff working in Paris – a figure that has quadrupled since Brexit. It is not clear how many will be moving back to London.

The Big Four firms are facing profitability challenges, prompting significant changes to their traditional partnership model. KPMG has begun demoting senior equity partners to lower-status salaried roles, reflecting a shift towards a more performance-driven culture. James Ransome, a partner at Patrick Morgan, noted: “Firms are becoming more performance-driven and, in many cases, more corporate in how they manage senior talent.” The trend of fewer promotions continues, with EY experiencing a nearly 70% drop since 2022. Elsewhere, PwC is creating more managing director roles to retain talent without increasing equity partner numbers.

The Chancellor is preparing to set out a fresh push for fiscal discipline after the May 7 elections, along with closer ties with the EU and planning reforms.