Latest news with #employmenttaxes
Telegraph
2 days ago
- Business
- Telegraph
Rachel Reeves only has herself to blame for this recession
Companies were hammered by a steep rise in employment taxes. Business rates went up sharply as reliefs were wound down. The living wage was pushed up, and stamp duty breaks were slashed. Against that dismal backdrop, it is probably a miracle that the GDP figures for April published today recorded only a 0.3 per cent month-on-month decline in output. The Chancellor Rachel Reeves will shamelessly try to blame that on the tariff war started by president Trump. But the blunt truth is this. The unfolding recession was entirely predictable – and she has only herself to blame. April was always going to be a tough month for anyone struggling to run a business in the UK. Employer National Insurance went up, and we saw the initial impact of that in the annual loss of 274,000 jobs in the employment data reported earlier this week. Likewise, one of the biggest rises in the living wage was imposed, and we saw the effect of that in declining hours worked in sectors such as shops and restaurants, which need lots of modestly paid staff. Business rates went up sharply, as reliefs were wound down, with many pubs facing an extra £12,000 or more in the amount that they have to pay to the local council, and closures are now running at 100 a month. Stamp duty went up as reliefs were phased out, and we have already seen the consequences of that in the 0.4 per cent decline in home prices reported by Halifax last week. In the background, industrial electricity prices have remained by far the highest in the world, forcing factories to close their doors. One by one Reeves has taken the major sectors of the British economy – property, hospitality, retailing and manufacturing – and whacked them with huge extra charges. Sure, it didn't help that the US imposed tariffs on the UK along with its other major trading partners. And yet, in reality, the sharp fall in output witnessed in April was entirely self-imposed. It took an extraordinary level of incompetence, and a breath-taking level of arrogance, to sequence such a punishing round of tax increases so that they all kicked in at the same time. It is not as if Reeves was not warned of the devastating impact of her tax rises on businesses. The M&S boss Stuart Machin called for the NI rise to be phased in back in February but was ignored. The British Beer and Pub Association called for help with business rates, but no one at the Treasury paid any attention. Rightmove called for stamp duty relief to be extended, and so did many other estate agents, but the Government didn't listen. The list goes on and on. Time and time again, businesses have told the Chancellor that her policies are killing their trade, only to be ignored. As it has turned out, however, they were completely right, and today's GDP figures have proved that. It is going to get much worse over the next few months. We have only seen the start of the fall in employment after the NI rise. After all, if your wage bill is out of control, it takes time to slim staff numbers. There are procedures to follow before you dismiss someone, and most small companies will rely on natural wastage, and simply not replace people, instead of risking the cost of an employment tribunal. Stamp duty has only just gone up, and it will take buyers a while to figure out they can no longer afford to move. Meanwhile, retail sales are falling again, and the inevitability of more tax rises on business in the autumn is deterring investment. Reeves chose to ignore the warnings that her tax raids would crash the economy. She will now have to reap the consequences of those decisions – and unfortunately so will the rest of us.
CBS News
22-05-2025
- Business
- CBS News
Bay Area execs admit to not paying employment taxes, using money for golf, hockey tickets
Two executives of a San Francisco Bay Area company face federal prison after pleading guilty to not paying millions of dollars in employment taxes to the IRS, spending the money on themselves. According to the U.S. Attorney's office for the Northern District of California, Lalo Valdez and Matthew Olson pled guilty to the charges on Monday. Valdez was the CEO and Olson was the CFO of a San Jose-based health informatics and product development company. The company provided clinical care and technology services to clients in healthcare and academia. Prosecutors said between 2017 and the second quarter of 2021, Valdez and Olson withheld Social Security, Medicare and federal income taxes from employees' wages, but did not pay them to the IRS or report them on quarterly tax forms. "Instead of paying over the taxes, Valdez and Olson used the company's money to pay for country club memberships and season tickets to the San Jose Sharks of the National Hockey League," said a statement from the U.S. Attorney's Office. Olson was one of the owners of a day spa in Saratoga. Prosecutors said he withheld the taxes of day spa employees but did not pay the IRS between the second quarter of 2017 and the fourth quarter of 2020. Prosecutors said Olson was responsible for more than $2.1 million in losses to the IRS, while Valdez was responsible for nearly $1.5 million in losses. Olson and Valdez face a maximum sentence of five years in prison along with supervised release, restitution and monetary penalties. The pair are scheduled to be sentenced on Oct. 20.
