Ministers are considering a punitive exit tax for businesses that relocate abroad after benefiting from UK taxpayer funding. The proposed levy aims to prevent university spin-outs or start-ups supported by state grants from taking valuable intellectual property and jobs overseas. Lord Vallance, chair of Andy Burnham’s AI Taskforce, is leading the initiative. The tax would be based on a company’s valuation if it sells or floats abroad after receiving public money. One industry source said: “The optics of spin-out companies going abroad does not look good for the UK voter.” However, another said the move would only make it more difficult for companies to leave, not prevent it, and universities would end up with a smaller stake.

Research from the Adam Smith Institute reveals that nearly 70% of Britons believe the wealthiest 1% pay their fair share of taxes. The study indicates that two-thirds of respondents recognise that ordinary workers’ taxes would rise if wealthy individuals left the country. The number of millionaires in the UK has decreased to 442,000, the lowest since 2008. Andy Burnham is urged to abolish inheritance tax and reform capital gains tax, which currently stands at 18% for basic rate taxpayers. The shadow chancellor Sir Mel Stride commented: “Britain’s patience is wearing thin with Labour’s tax rises. The British people know, far better than this Government, that prosperity is driven by people who want to build a better life, for them and their children.”

No country has successfully implemented a wealth tax, writes Daniel Hannan in the Sunday Telegraph, yet proposals continue to emerge in the UK. Despite concern within the Treasury that income from high earners is dwindling, and Labour allies such as Lord O’Neill describing wealth taxes as “stupid”, Hannan fears Labour will press on with adjacent forms of tax – levies on expensive homes, inheritance and investment, for example. All this instead of cutting the ever-ballooning spending bill. “We demand taxes that we think will fall on others without stopping to consider their impact on our national wealth,” he says. “We are, in short, choosing to be poor.”

Richard Walker, Sir Keir Starmer’s former Cost of Living Czar, has urged Andy Burnham to cut business taxes in the upcoming Budget to stimulate job creation and economic growth. In an article for The Sun on Sunday, Walker said the Government should shift focus from cost of living to making it cheaper for businesses to hire and invest. He warned that rising costs, such as National Insurance and business rates, deter job creation. Walker also pressed the need for “brave decisions on welfare” to reduce the benefits bill and help people return to work.

UK energy chiefs have warned that further tax rises on the North Sea would harm investment and accelerate job losses. Following news that John Healey was considering a windfall tax on banks and oil and gas majors, Russell Borthwick, the chief executive of the chamber of commerce in Aberdeen, wrote to the Chancellor to make clear that fresh changes to the fiscal regime would “severely undermine investor confidence and energy security” and would cripple an industry “which Britain cannot afford to lose”. A new tax grab could also put BP’s sale of its North Sea assets at risk as it would discourage suitors.

UK business investment in digital infrastructure, particularly data centres, reached £11.2bn in 2025, nearly double the £5.8bn from a decade ago. The Office for National Statistics (ONS) revised its methodology to better reflect spending on such facilities, which are essential for artificial intelligence deployment. The ONS reports that 35% of UK businesses utilise AI, with 58% in the information and communications sector.

Brexit is costing the UK £11.7bn a year in lost exports, according to Logistics UK. A report from the trade association claims that 98.2% of businesses want access to the EU single market restored. Meanwhile, a European Movement UK survey revealed that 72.8% of firms feel Brexit negatively impacts their operations. With rising paperwork and border complexities, businesses are struggling.

Allan Leighton, the chairman of Asda, has warned that rising taxes are damaging consumer confidence and hindering business investment in the UK. He said the country is nearing a “tipping point” and the upcoming Budget would determine whether the Government could avoid damaging the economy further. Leighton went on to note the inevitability of rising food prices due to crop damage from recent heatwaves.

James Ashton, the chief executive of the Quoted Companies Alliance, urges UK pension funds to invest more in local businesses rather than channelling funds into foreign assets. He points to the importance of SMEs for national prosperity, noting a decline in share trading in London over 45 months. Ashton said: “In this summer of takeovers, it is really important to remember that a share quote is an anchor in the UK for jobs.” He also calls for conditional tax relief for pension funds to encourage domestic investment.

The cost of UK government debt has surged to its highest level in nearly 30 years, with average yields on bonds reaching 3.8% this year. The increase is attributed to persistent inflation and concerns over global borrowing. The Office for Budget Responsibility forecasts that debt interest spending will exceed £100bn annually, impacting public finances. James Smith from ING noted that energy prices have significantly influenced borrowing costs, while Tomasz Wieladek from T Rowe Price pointed to the UK’s poor inflation performance as a key factor in rising gilt yields.

Tom Saunders reports in the Sunday Telegraph on how US private equity and hedge funds are increasingly acquiring UK defined-benefit pension schemes. Over the past year, 370 buyout transactions were recorded, with forecasts suggesting UK deal volumes could reach £500bn in the next decade. Commenting on the situation, Steve Webb, a former pensions minister, says: “If you were the [Prudential Regulation Authority] or the Bank of England or whatever, you’re going to keep a close eye on this. You’re going to make sure that huge pools of money going from one part of the economy to another doesn’t create some concentration risk.”

Andrew Bailey, the Governor of the Bank of England, has written to G20 finance ministers and central bank governors to express his concerns about the risks posed by advanced artificial intelligence (AI). He said that “frontier” AI models exhibit sophisticated autonomy and could destabilise the global financial system through cyber-disruption. Bailey noted that many jurisdictions lack protocols to manage these technologies, increasing risks for the financial sector. He called for international cooperation to address these challenges.