Dame Jane Fraser, the chief executive of Citigroup, has expressed concern over the UK’s high taxes, saying the rate faced by banks significantly exceeds those seen in rival financial centres such as New York, Frankfurt and Paris. While she acknowledged the UK’s strengths, she also warned that rising taxes could lead Citi to consider alternative investment locations. Highlighting the risk of reduced investment in London, Dame Jane said: “Money votes with its feet.” Dame Jane’s comments echo similar concerns raised by JPMorgan CEO Jamie Dimon. Banks face the 25% rate of tax charged on companies’ profits, plus an extra corporation tax supplement of 3%. However, a report by UK Finance estimates that the total tax rate for banks is around 46.4% once other levies such as VAT and National Insurance are factored in.

According to a survey by Wealth Club, higher taxes are the primary concern for 49% of Britain’s millionaires. The poll found that 26% worry about future government policies, while only 9% see geopolitical events as a significant threat. Inheritance tax was the biggest tax concern, cited by 22% of respondents, followed by the potential introduction of a wealth tax (21%) and increases to capital gains tax (18%). Nearly all of the surveyed millionaires anticipate tax increases in the coming year. It was also shown that 63% expect higher inflation and nearly six in 10 believe that the Bank of England will increase interest rates.

Council leaders in London are urging the Chancellor to reconsider the proposed mansion tax, which could cost households in Kensington and Chelsea, Wandsworth, Richmond, and Westminster £270m annually. They argue that the tax disproportionately affects long-term residents, particularly pensioners, who may be forced to sell their homes. Homeowners with properties worth more than £2m face an annual charge of between £2,500 and £7,500 from 2028. Elizabeth Campbell, leader of Kensington and Chelsea Council, said: “This is not a tax carefully targeted at the very wealthy.”

A rush to protect families from planned inheritance tax changes on unused pension savings has driven a sharp rise in life insurance demand. From April next year, pension pots and death benefits will become subject to inheritance tax, prompting many savers and business owners to seek ways to cover potential liabilities. Royal London said customers with sizeable pension pots, particularly small-business owners, are increasingly turning to advisers who often recommend life insurance to pay future tax bills and avoid forcing families to sell businesses.

Analysts have warned that investors may be “less than impressed” by Chancellor John Healey’s reported plans to increase borrowing by £9bn a year to fund infrastructure, housing and business investment, despite the spending potentially fitting within Labour’s fiscal rules by being classified as asset-building. Quilter’s Richard Carter said the extra borrowing was “small fry in the grand scheme of things” but cautioned that “borrowing dressed up in new clothes is still borrowing,” with the UK remaining vulnerable to bond market pressures. He added that markets may be concerned that “spending remains the Government’s preferred antidote to the growth malaise.” Oliver Faizallah, head of fixed income for Raymond James, said investors would need evidence that projects generate economic returns, arguing the Government must prove that investments are “additive to the UK” and communicate its plans clearly. He also warned that bond markets could become nervous ahead of the Budget if concerns over borrowing and fiscal policy increase.

The Financial Conduct Authority (FCA) has introduced immediate reforms to simplify listing rules, with the City watchdog looking to revitalise London’s stock market. Key changes include removing the mandatory seven-day waiting period between publication of an approved prospectus and associated investment research, allowing issuers and their advisers to respond more quickly to market conditions. The FCA said the reforms are intended to improve the efficiency and competitiveness of UK capital markets while maintaining investor protections. Jon Relleen, director of infrastructure and exchanges at the FCA, said: “By making the UK listing regime more efficient, we are supporting the growth and competitiveness of UK capital markets.”

Britain’s services sector returned to growth in July as new orders recovered, with the S&P Global UK Services PMI rising to 52.1 from 48.8 in June, its first expansion since April. Growth was supported by a rebound in total new work, which rose to 50.8, the strongest level since February, ending a four-month decline linked to the Iran war. Business confidence also improved, reaching its highest level since February, as firms anticipated easing geopolitical tensions and lower inflation pressures. However, employment remained weak, with service-sector employment declining for a 22nd consecutive month. The broader composite PMI, covering services and manufacturing, also moved back into growth territory at 52.2, up from 49.3.

In July, Britons registered 156,500 new cars, marking an 11.7% increase year-on-year, the highest since before the pandemic. The Society of Motor Manufacturers and Traders (SMMT) reported that fully electric vehicles (EVs) accounted for 27.5% of new registrations, with 43,106 units sold, a 44.5% rise from last year. Mike Hawes, the SMMT’s chief executive, has called for ministers to “urgently reform regulations” to enhance competitiveness in the car manufacturing sector.

A survey by Standard Life found that 22% of adults have less confidence in pensions as a retirement savings tool after learning that unused pension pots will become subject to inheritance tax from April 2027. The firm warned the change could discourage people from saving. Most estates will remain unaffected, but the number paying inheritance tax is expected to rise from around 4–5% today to 7% once pensions are included.