Market Loop - Taxing times for the chancellor

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11th April 2022

Bite-sized business news from the UK and beyond

Good morning Last week Glassdoor released its list of US companies with the highest paying internships. Topping the list was online gaming platform Roblox, with an average monthly salary of $10k, yes monthly. Us? Jealous of the interns? No, we’re not jealous. Not at all.

Today's stories

Taxing times for the chancellor
Talk of a Talktalk takeover

TAX
Taxing times for the chancellor

What’s going on?
The chancellor Rishi Sunak has been criticised for increasing taxes on working households while his wife benefits from a scheme that helps the wealthiest avoid paying UK taxes.

Why is this important?

It’s been a turbulent few weeks for Rishi Sunak. First his Spring Statement received a lukewarm reception with critics arguing it didn’t do enough to tackle the cost of living crisis. And then in the past week his family’s tax affairs have been under scrutiny.

The chancellor’s wife Akshata Murty has been claiming non-domiciled (non-dom) status for the past seven years and therefore legally doesn’t have to pay UK taxes on her overseas earnings. As a result she’s saved an estimated £20m in tax from the dividends she’s received as 0.9% owner of Indian tech giant Infosys, which her father founded.

A non-dom is someone who lives in the UK and is tax resident here, but who has their permanent home outside the country. It can cost as much as £60,000 a year to maintain the status so is unsurprisingly only really a position taken by the very wealthy.

In a population of 65m there are only around 70,000 non-doms. However they are particularly concentrated in some circles with an estimated one in five top earning bankers being non-doms.

The status is particularly controversial as its seen as a way for the rich to avoid paying tax on their worldwide income while still benefited from UK tax-funded services.

Zooming out

British households are paying the highest proportion of their income in tax since the 1940s. So it’s not a great look when the family of the man in charge of tax rates is benefiting from tax loopholes.

Amid the pressure Ms Murty said on Friday that she would in future pay UK tax on her global earnings.

Other stories to keep you in the loop

Joining salaries rising at the fastest rate since 1997
Thousands of civil service jobs at risk as Treasury drives down headcount
Sainsbury's increases pay as cost of living crisis bites
Twitter U-turns on Elon Musk joining the board after becoming firm's largest shareholder
Walmart offering new truckers starting salary of up to $110,000
Epic and Lego partner to build a metaverse for kids
French presidential race: Macron and Le Pen through to second round

TELECOMS
Talk of a Talktalk takeover

Talktalk is said to have been approached by several potential suitors for a takeover that could value the business at as much as £3bn.

As one of the UK’s largest broadband providers, Talktalk has reportedly attracted the attention of fellow telecom players Vodafone and Sky.

A tie-up between two huge British businesses would be the latest mega-merger attempt this year, after it was revealed that Unilever had tried to buy GlaxoSmithKline's consumer healthcare division.

Talktalk used to be listed on the London Stock Exchange but the business was taken private in 2020 in a deal worth £2bn. Less than two years later the business could change hands again.

Founded in 2003 Talktalk was originally part of retail group Carphone Warehouse before it was demerged to become a separate company in 2010. It has over 4m customers and 2.4m fibre broadband connections across the UK as well as a pay-TV service that includes channels from both Sky and BT Sport.

So why would Talktalk make a good target? The ultra-fast internet market is the future of telecoms and acquiring Talktalk would help a buyer take market share. Consolidation in the sector is also seen as a way to cut costs so companies can invest in the new digital age.

Stat of the day

Nearly half of working-age women are providing an average of 45 hours of unpaid care every week

Interesting links from around the web

Best value holiday destinations in 2022
Apparently, there are 16 different types of sleepers. Which one are you?
How to design a feelgood house

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Indian tech giant Infosys Bitesized business news highest paying internships online gaming platform average monthly salary past seven years chancellor Rishi Sunak

Market Loop - Taxing times for the chancellor

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