A round up of other news this week.
The UK Government has announced that it will consult on reform of the Apprenticeship Levy from 2020. It is proposed that employers will be able to spend 25 percent of their apprenticeship funds on training for employees in their supply chain. Apprenticeship standards will also be revised and updated. As skills training is a devolved matter, our expectation is that these reforms will apply only to employees in England.
The Welsh Government published an outline draft Budget 2019-20 on 2 October in which it confirmed it “will not propose any changes to the rates and bands for land transaction tax in the outline draft Budget, however landfill disposal tax rates will rise in line with inflation, as announced last year.” In a separate announcement the Government confirmed its proposal that “the rates of income tax paid by Welsh taxpayers will continue to be the same as those paid by English and Northern Irish taxpayers” from 6 April 2019. This remains subject to confirmation by the National Assembly for Wales.
On 1 October 2018, the Multilateral Convention (MLI) entered into force in respect of the United Kingdom. This follows the deposit of the instrument by the UK earlier this year on 29 June. The MLI also entered into force for New Zealand, Serbia and Sweden.
On 20 September 2018, the Court of Justice of the European Union (CJEU) published its decision in the EV v Finanzamt Lippstadt case (C-685/16) concerning the compatibility of the German participation exemption regime applicable to dividends originating in third countries with the free movement of capital. The Court concluded that the German legislation is contrary to the free movement of capital.
The Office of Tax Simplification (OTS) has announced that both its Tax Director, Paul Morton and its Chair, Angela Knight will be stepping down once replacements are in place.
The recent Harvey Nash/KPMG CIO Survey found that 60 percent of UK CIOs said that management were looking at IT to help enhance the customer experience. Lisa Heneghan, KPMG in the UK’s Head of Digital Transformation stated that “customer centricity is becoming understood to be at the core of driving greater value for organisations”.
Yael Selfin, Chief Economist at KPMG UK, comments on the recent Q2 GDP figures stating that consumer spending appears to have been stronger in the first half of 2018 than earlier estimates, financed by a dip into savings and rising debt. This throws into doubt the sustainability of such spending as interest rates rise and wage growth remains subdued.
A recent consumer survey conducted by YouGov for KPMG UK, found that more than one in five UK adults aged 25-34 spend over 60 percent of their income the very day it enters their account.