Latest news with #chancellor
Al Arabiya
2 days ago
- Politics
- Al Arabiya
Berlin says it is prepared to increase pressure on Israel over Gaza
The German government said on Monday that it is prepared to take steps to put pressure on Israel with regards to the humanitarian situation in Gaza, but did not give details on what they could be. 'The chancellor was very clear in the phone conversation with the Israeli prime minister ... that the federal government is prepared to increase the pressure if progress is not made,' a spokesperson said. 'In principle we are prepared to take further steps, which is also the purpose of this afternoon's security meeting,' he said, referring to a meeting of the German security cabinet.
Times
3 days ago
- Business
- Times
The secret savings tax grab — and how to escape it
Savers and investors get a range of tax breaks and incentives that are designed to encourage them to make smarter decisions for their wealth. Tax relief on pension contributions and the £20,000 Isa allowance have escaped government tinkering, despite costing the Treasury billions of pounds. Tax breaks on pensions cost £70 billion a year, the latest figures show. But underneath all that, the government is sneakily taking an increasing share of the spoils made by those who risk their own money on the stock market. And you may not realise it. A flurry of recent rate increases and cuts to tax-free allowances helped raise as much as £50 billion from savings and investments in the last tax year — just as the chancellor plans to nudge savers to invest more in a bid to boost economic growth. Interest and returns made on savings and investments held in Isas are free of capital gains tax (CGT) and income tax. However, the £20,000 annual allowance has been frozen since 2017 and won't go up until at least 2030 — saving the government an estimated £605 million a year by that point. Anyone who has used the full allowance and holds shares and other investments outside an Isa can end up being taxed as many as five times: income tax on your wages; stamp duty when you buy shares; tax on dividends; capital gains tax (CGT) if you sell; then inheritance tax when you die. The amount of capital gains you can make before you have to pay tax was cut by the previous government from £12,300 in 2021 to £3,000 while the dividend allowance went from £2,000 to £500. In April the Labour government created a single 18 per cent rate of CGT for basic-rate taxpayers and a 24 per cent rate for most higher and additional-rate taxpayers. The rate of dividend tax is 8.75 per cent for basic-rate taxpayers and 33.75 per cent for higher and additional-rate taxpayers. • How much one year of Labour has cost you Anyone buying UK shares has to pay 0.5 per cent stamp duty reserve tax, which netted the Treasury £4.3 billion in the last tax year. The Sunday Times has called for stamp duty to be scrapped as part of its Revive the City campaign to boost the UK's stock market. The government collected £25.5 billion in CGT, inheritance tax and stamp duty on shares in 2024-25, according to official figures. The Office for Budget Responsibility expects the total to be £44.9 billion for 2029-30. The amount cash savers can earn before being taxed on their interest is restricted to £1,000 a year for basic rate taxpayers and £500 for higher rate taxpayers and the allowances have not changed since they were introduced in 2016. Additional rate payers get no allowance. Tax on dividends and savings interest raised £24.2 billion in 2024-25 (7.8 per cent of income tax receipts). If that percentage stayed the same, taxes on those two assets would raise £31 billion by 2029-30. In all, taxes of wealth could total as much as £76 billion a year by the end of the decade. In a speech to City bosses at Mansion House in London, the chancellor, Rachel Reeves, unveiled a series of policies; from asking pension funds to invest more of savers' money into private UK companies, to an advertising campaign to promote the benefits of investing. She said: 'For too long we have presented investment in too negative a light, quick to warn people of the risks, without giving proper weight to the benefits.' Maximilian Bierbaum from New Financial, a think tank, said: 'The government rightly wants to widen retail participation in capital markets. But it is sending mixed signals: it cancelled the proposed retail sale of shares in NatWest in July last year which would have given retail investors a big opportunity to invest in a household name, and it has raised capital gains tax.' Another review into the state pension age was announced on Monday, while the chancellor's plan to charge inheritance tax on pension pots was also confirmed. This all comes at a time when more pensioners than ever can expect to pay tax on their retirement savings, thanks to the freeze on income tax thresholds that began in 2021 and is set to last until at least 2028. Some 9.28 million pensioners are expected to pay income tax this year, including 979,000 higher-rate taxpayers, up from 7.1 million in 2021-22, according to HM Revenue & Customs. And from April 2027 pensions will form part of your estate for inheritance tax purposes, so if you leave your savings pot to anyone but your spouse or civil partner (who are exempt from inheritance tax), they could lose 40 per cent of it. If you die after the age of 75, they will have to pay income tax on withdrawals too. You can pass on £325,000 of assets from your estate inheritance tax-free — £500,000 if you leave your main home to a direct descendant and your estate is worth less than £2 million. Any assets above those thresholds can be taxed at 40 per cent. David Gibb from the wealth manager Quilter Cheviot said the recent stream of tax changes have left savers and investors 'grappling with a rising tide of complexity'. • Families face red tape nightmare with inheritance tax on pensions The first thing investors should do is to look to hold any stocks and shares in an Isa. Adults get a £20,000 annual allowance that can be split across cash and investment options. The chancellor was said to be considered restricting how much of your allowance you can save in cash, to nudge more savers towards investing, but the plans led to a fierce backlash from the industry and have been put on hold until the budget in the autumn. Inside an Isa you do not need to worry about CGT on investment growth, or taxes on dividends and savings interest, but they will still be part of your estate for inheritance tax purposes. If your Isa allowance is already used up, you could make tax savings by maximising your pension saving. Pensions are also CGT-exempt and you get income tax relief on contributions. Savers can pay in up to £60,000 a year, and you can take a 25 per cent tax-free lump sum from your pot after the age of 55. Daniel Herring from the Centre for Policy Studies, a right-leaning think tank, said: 'Wealth taxes are more damaging than taxes on income and consumption. They stop people making decisions that will lead to higher economic growth. 'CGT acts as a deterrent to investment, while extending inheritance tax to non-doms has led very wealthy people to move overseas to avoid it, taking their investments and capital with them.' Alex Kontoghiorghes, a researcher at the Bank of England, looked at what happened after the Isa rules changed in 2013 to allow investment in companies listed on the Alternative Investment Market (Aim). He found that companies were able to raise money more easily, because investors could buy into them more cheaply, which reduced their capital costs and permanently increased their share prices and dividends. Aim firms also invested more in their businesses and increased workers' pay. 'Changing the level of investment taxes incentivises capital flows into certain assets,' he said. Research by Interactive Investor suggests that 72 per cent of investors would invest more in UK stocks if stamp duty was abolished but just 2 per cent would invest more if the cash Isa allowance was cut. Last year the Centre for Policy Studies and the consultancy Oxera suggested that abolishing stamp duty on UK shares could boost the economy by up to 0.7 per cent and share prices by 4 per cent. It said it could actually raise £600 million more for the government than it would cost. Bierbaum said: 'It's quite frankly ridiculous that an investor in the UK pays stamp duty when they buy a share in AstraZeneca or BP but not when they buy a share in Nvidia or Apple. We penalise investors when they want to invest in the British economy.'
Telegraph
6 days ago
- Politics
- Telegraph
First MP to come out as gay is named Cambridge chancellor
The first MP to come out as gay has been named as the new chancellor of the University of Cambridge. Lord Smith of Finsbury will replace Lord Sainsbury of Turville, a fellow Labour peer, to become the university's 109th chancellor. He beat nine rivals to the role, including Sandi Toksvig, the former host of the Great British Bake Off, Gina Miller, the anti-Brexit campaigner, and Lord Browne of Madingley, the former chief executive of BP and a cross-bench peer. The chancellorship is a largely ceremonial position at the head of the university, representing it at events and in fundraising initiatives. The role is unpaid, but its extensive foreign travel is covered by the university. Around 25,000 Cambridge alumni and staff cast their votes in the chancellorship race, which was the first to take place both online and in person in the role's 800-year history. Mohamed El-Erian, an Egyptian-American businessman and the current president of Queen's College, Cambridge, won the most first choice votes in the ballot, but the single transferable vote system saw Lord Smith emerge the victor. The politician has been the master of Pembroke College, Cambridge since 2015 and became a Labour peer last year, having previously served as the party's MP for Islington South and Finsbury. Lord Smith's 22-year stint as a Labour MP saw him serve as secretary of state for culture, media and sport for four years during the Blair administration. He later became chairman of both the Environment Agency and the Advertising Standards Authority. In his candidate statement to become Cambridge chancellor, Lord Smith said his experience as the first openly gay MP showed his commitment to 'diversity, openness and ethics'. He won 4,500 votes in the initial count compared to Mr El-Erian's 4,818, but scooped up other votes in the ranked ballot to become the overall winner. In a statement announcing his election, Lord Smith said: 'To be elected as chancellor of the university I love is a huge honour. I'm thrilled. I look forward to being the best possible ambassador for Cambridge, to being a strong voice for higher education more generally, and to working closely together with the vice-chancellor and her team.' Prof Deborah Prentice, Cambridge's vice-chancellor, said: 'On behalf of everyone at the university, I offer my warm congratulations to Chris on his election. I very much look forward to working with him and building on the strong relationship that we have developed since I became vice-chancellor. 'Chris has had a long involvement with the university, and brings a wealth of relevant experience to this important role. I would like to thank the other nine candidates for standing for the role and their willingness to serve Cambridge.' Lord Sainsbury stepped down earlier this year after 14 years as chancellor. Lord Smith, who will serve a reduced term of 10 years under new chancellorship rules, inherits Cambridge's figurehead position at a difficult time for the university sector as it grapples with a worsening financial crisis and increasingly polarised debate over free speech. His appointment comes on the day Cambridge was been granted a year-long injunction banning pro-Palestinian protests on campus. Cambridge has been granted several previous injunctions to stop protest activity on campus, but those have all covered specific events, such as forthcoming graduation ceremonies. Lord Smith has previously supported the university's use of legal action to shut down pro-Palestine encampments on campus, citing potential disruption to students' exams. The university returned to the High Court on Wednesday seeking a more sweeping 12-month injunction, which will also cover Chestnut Tree Lawn – a plot of land in front of King's College – as well as Senate House, the Old Schools and Greenwich House. The Russell Group institution said in written submissions to the court that there was 'an increase in the risk and threat of direct action taking place against the university'. It added that 'the possibility of further war in the Middle East involving Israel and Iran amongst other countries is also likely to lead to further unrest over the summer period'. Kester Lees KC, for the university, said the harm caused to the university by previous protests was 'substantial', including thousands of people being disrupted during graduations, staff being unable to work, and more than £230,000 being spent on extra security, cleaning, and legal costs. The European Legal Support Centre and the human rights group Liberty both intervened in the case to express opposition to the move, with the university's students' union, which is not involved in the legal proceedings, also criticising the injunction bid. Mr Justice Butcher, the judge presiding over the case, said he would set out his reasons for granting the injunction at a later date. The injunction could place Lord Smith in a difficult position, with his pitch for chancellorship centred around a commitment to freedom of speech. In an interview with The Telegraph last month he criticised those who attempt to 'no-platform' controversial figures in the university, saying: 'Free speech is about allowing people to say controversial things, but then challenging them and debating with them.' He also criticised the BBC for livestreaming 'Death to the IDF' chants on a Glastonbury stage by the punk duo Bob Vylan last month. Lord Smith told The Telegraph: 'Urging death to anyone, including the IDF, is completely unacceptable. If I were the BBC, I would have pulled the feed immediately. It's what they should have done.'
Times
6 days ago
- Politics
- Times
Lord Chris Smith elected as chancellor of Cambridge University
Lord Smith of Finsbury has been announced as the new chancellor of the University of Cambridge. Smith, a Labour peer and the outgoing master of Pembroke College, Cambridge, has become the 109th chancellor and will hold the largely ceremonial position for ten years. Smith's election concluded a contest featuring ten candidates, including Lord Browne, the former chief executive of BP, and Mohamed El-Erian, a prominent economist. Sandi Toksvig, the broadcaster and award-winning author, was also among those who stood for the position. Commenting on his election, Smith said: 'To be elected as chancellor of the university I love is a huge honour. I'm thrilled. I look forward to being the best possible ambassador for Cambridge, to being a strong voice for higher education more generally, and to working closely together with the vice-chancellor and her team.' After the votes were counted, El-Erian emerged in second place, followed by Toksvig and Browne. For the first time, the election used online voting, leading to the participation of more than 23,000 alumni and staff. Nearly 2,000 chose to cast their ballots in person at the university's Senate House. Professor Deborah Prentice, the university's vice-chancellor, said: 'On behalf of everyone at the university, I offer my warm congratulations to Chris [Lord Smith] on his election. I very much look forward to working with him and building on the strong relationship that we have developed since I became vice-chancellor. Chris has had a long involvement with the university and brings a wealth of relevant experience to this important role. 'I would like to thank the other nine candidates for standing for the role and their willingness to serve Cambridge.' Smith has been the master of Pembroke since 2015 and will step down from that post at the end of July. He is a former secretary of state for culture, media and sport, and was later chairman of the Environment Agency. Announcing his candidacy in May, he said that he wanted to defend academic freedom and free speech. 'Universities must be places of rigorous intellectual inquiry and open dialogue — free from political interference,' he added.
The Independent
6 days ago
- Politics
- The Independent
Former culture secretary Lord Chris Smith elected as Cambridge chancellor
Former culture secretary Lord Chris Smith has been elected as the next chancellor of the University of Cambridge. Lord Smith beat nine other candidates, including broadcaster Sandi Toksvig and anti-Brexit campaigner Gina Miller, in the race for the historic position. It comes after Lord Sainsbury of Turville announced last year that he intended to step down after more than a decade in the role. Lord Smith, the outgoing Master of Pembroke College in Cambridge and former Labour culture secretary under Sir Tony Blair, will hold the office for 10 years, the university announced on Wednesday. The election for the chancellor was opened to online voting for the first time, and more than 23,000 alumni and staff participated. In addition, nearly 2,000 chose to vote in person at the university's Senate House in Cambridge. The chancellor, a position which stretches back more than 800 years, is the university's formal and ceremonial head. They have no executive responsibilities, but they will be a part in advising senior members of the institution, fundraising, and acting as an ambassador for Cambridge. Lord Smith, who will step down as Master of Pembroke College later this month after a decade in the role, said: 'To be elected as chancellor of the university I love is a huge honour. I'm thrilled. 'I look forward to being the best possible ambassador for Cambridge, to being a strong voice for higher education more generally, and to working closely together with the vice-chancellor and her team.' Lord Smith served as secretary of state for culture, media and sport between 1997 and 2001. He stood down as an MP in 2005 and was made a life peer. He was also chairman of the Environment Agency from 2008 to 2014, and chairman of the Advertising Standards Authority between 2007 and 2017. Professor Deborah Prentice, vice-chancellor of the University of Cambridge, said: 'On behalf of everyone at the university, I offer my warm congratulations to Chris on his election. 'I very much look forward to working with him and building on the strong relationship that we have developed since I became vice-chancellor. 'Chris has had a long involvement with the university and brings a wealth of relevant experience to this important role. 'I would like to thank the other nine candidates for standing for the role and their willingness to serve Cambridge.' Candidates standing to be the chancellor had to secure at least 50 nominations from alumni and current staff who are members of the Regent House, the university's governing body. The election was held between July 9-18 and was conducted under the single transferable vote system. In the final round, Lord Smith received 10,569 votes, 2,129 more than second-placed candidate Dr Mohamed El-Erian, president of Queens' College, Cambridge, who received 8,440 votes. QI host and former The Great British Bake Off presenter Ms Toksvig, who had hoped to become the first female Cambridge chancellor, came third. Lord Smith also defeated Lord Browne, former BP boss, Cambridge astrophysicist Professor Wyn Evans and businesswoman Mrs Miller. In his candidate statement for chancellor, Lord Smith, who became the UK's first openly gay MP in 1984, highlighted his 'commitment to diversity, openness and ethics' and freedom of speech. He said: 'We live in a dangerous world of misinformation and 'fake news'. 'Universities are the places where facts are researched and honoured, where information is discovered and tested and debated. 'It is why a genuine commitment to freedom of speech is so important.' Lord Smith, who studied English at Pembroke College, Cambridge, said: 'It is no accident that the first target of autocrats everywhere is education; tyrants do not want people to have and acquire knowledge. 'The Chancellor has above all to be an advocate for the vital importance of knowledge and expertise.'
