A fair tax system. You decide?

I read City AM’s headline with interest today – “67,700,000,000 – The amount of tax paid by Britain’s top 100 companies last year”.

Alongside the new stories about companies and individuals who “avoid” paying the maximum tax (see the headlines about Ken Livingstone avoiding PAYE by paying consultancy fees into a company, thereby paying the lower rate of corporation tax and the headlines about Barclay’s being ordered to pay an extra £500 million to HMRC) City AM reports that big companies paid an extra 14% more compared to the previous year.

The figures were released by PwC today but City AM makes the point that the Treasury is attempting to show the public that it’s not letting big business get away with avoiding paying tax.  Critically, David Gauke MP (Treasury Minister) argues that businesses must “demonstrate just how critical (their) success is to the prosperity of individuals and families across the economy”.  Very simply, the better our business do, the more tax they pay the better off the country is!

There are daily “name and shame” stories about how “over paid” various individuals are and this fuels the flames of anti-business sentiment.   There was an interesting article in the Evening Standard yesterday with Sam Leith offering the opinion that Ken Livingstone’s payment to his company rather than as an employee was a deliberate strategy to align himself with London’s business community – Leith says “In avoiding tax this way – and to hell with the potential unpopularity – he goes a mile in their shoes. He is putting his money where his mouth will follow”.  An interesting theory!! Read the full article here.

Whilst change is unavoidable – maybe too much reward is given to individuals in senior positions across the private and public sector for very little success, I do think that we should be championing UK businesses (of every size) to keep the wheels of the economy turning, generate more taxes and lower the country’s deficit.

I noted with interest that the HMRC would be appointing a new tax “assurance commissioner” to broker tax agreements and settlements with large groups – hopefully this will help co-ordinate such arrangements and ensure a fairer, more transparent system will be realised.

Am I being an idealist?  Am I over simplifying this?  I am deliberately not getting into how the taxes are actually spent (that’s a different debate) or perhaps you think that bigger businesses should pay more tax – especially if they are posting record results??  What do you think?  Join the debate!!

corporation tax, PAYE, Tax

Singapore is a bustling, world-class city-state that has made waves around the world for its business excellence. If you are on a business visit or furthermore looking to relocate and work in this lovely place in South East Asia, you should habituate yourself with the most common business etiquettes in Singapore.

Top tips for business etiquette:

- Bring lots of business cards to meetings. They should be presented with both hands with the name facing the recipient. Upon receiving a card never write on it, put it casually in your back pocket, or slot into a folder, as any of these actions can be misconstrued as disrespect.

-  Punctuality: although Singaporeans tend to arrive late for social events, being late for business appointments is paramount to an insult.

- Plan meetings in advance. It is essential to arrange your meetings in Singapore in advance. Do so weeks, even months, prior to your visit.

- Small talk: casual conversation is often typical at the start of a meeting and is part of ‘getting to know you’ phase. You may be asked questions about your background or personal details.

- Handshakes: are the most common business greeting in Singapore. A gentle squeeze lasting 10 to 12 seconds is ideal. While Westerners tend to read a lot into a handshake, for Singaporeans, ‘pressing the flesh’ is considered merely a friendly greeting. There are no subtle messages encoded in a handshake’s firmness or duration.

- Body language: Singaporeans are reserved in nature, so it is useful to be aware of their body language and verbal cues. In Western environments, looking a person straight in the eye says: “You have my full attention.” In Singapore, the direct look may be interpreted as disrespect, or worse – as aggression. Catch your counterpart’s eyes for a second, then immediately lower your head and look down. Your body language expresses that you are honouring the person in your presence.

To find out more about what to expect from living and working in Singapore, or hear about current opportunities contact Anouska Serich on +44(0)20 7092 0015 aserich@morganmckinley.co.uk

international experience, Singapore, Working in Singapore

This seems to be a topic which is often covered in conversations within our office.

The compliance and regulatory markets have been growing at an alarming rate since the demise of Lehman Brothers and the start of the recession, and it seems whilst some other middle office functions have had steady growth, the compliance market has seen some astronomical growth, both within sell side and buy side organisations in London.

With the FSA introducing new policies and procedures on a regular basis, does this mean that the compliance markets are likely to continue growing for the foreseeable future?

Morgan McKinley has continued to see a demand for compliance ‘talent’ for the past three and a half years, especially within sales and trading compliance and Anti-Money Laundering (AML).

With the introduction of the new regulators in 2013, will this mean that the compliance market will continue to see growth above other markets? …I think so!

Banking, City of London, Compliance, Financial Services, FSA, regulation

Offshoring operations overseas combined with an increasingly competitive jobs market, has left many professionals considering opportunities abroad. So what value is gained from international experience?

Stand out from the crowd. CVs with international work experience stand out. Employers appreciate the independence, personal resourcefulness and problem-solving skills necessary to work abroad. Particularly if you have sought the opportunity yourself.

Understand new business cultures. Working in a country that has a strong connection with your industry can add an incredible amount of value to your CV. Working abroad can also give you an understanding of other cultures, values and different ways of doing business. Surrounding yourself in a foreign work setting is very different from dealing with colleagues from other countries on the telephone. Even a relatively short period of time spent abroad can be very valuable to your career.

Acquire new skills. Learning a new skill or developing an existing skill is often easier in a new environment. Picking up a new language or learning new processes can be an invaluable benefit of working overseas and are often skills that can be used back in the UK.

Gain new contacts. An assignment abroad can quickly help build your professional network. Nurture relationships with colleagues, you never know where a contact may lead and who they might be able to refer you to for future jobs.

Earn money. Often companies pay generously for temporary workers, particularly abroad. Working as a contractor can be a lucrative option as well as tax efficient in many countries.

Lifestyle change. Working abroad can often offer a different lifestyle, and sometimes a greater work-life balance. In addition, it can give you thechance to explore new interests. It may even take you on to another contract or permanent role there or in another country.

Choosing to uproot and work abroad can be a big decision, plenty of research is essential before taking the leap. If the timing is right it can really develop your career opportunities.

abroad, CVs, international experience, Skills, work overseas, working abroad

Of course it’s positive to see our Employment Monitor registering an increase in job availability in January 12 after two months of declining hiring activity in the City.  However, it’s important to note that this is a very typical trend at this time of year with December being a shorter working month.  For the eight years that we have been recording job availability, January has always seen an increase in financial services hiring activity in London.

View full report

The number of jobs will also be boosted to some extent by roles that were signed-off but not released in December due to factors such as budgetary constraints. However, despite the fact that January shows a rebound, we have to put this into perspective; the total number of available roles in January 12 was just over half the number of January 11 which was in itself a relatively subdued month for hiring compared to previous years.  Despite the welcome monthly uplift, this 52% drop on the number of jobs in January 11 indicates we are still in a very cautious hiring market.

The rise in number of job seekers in the market in January 12 compared to December 11 again reflects the time of year. The ‘New Year, new job’ effect prevails to some extent every year regardless of economic conditions.  In addition, we are in the midst of bonus announcements, with expectations that many banks will be restricting the size of bonus pots to reduce costs and focus on other ways to attract talent.  Speculation and anticipation of unsatisfactory bonuses may have encouraged professionals to re-enter the jobs market in January 12.  However, as the distribution of bonus pots is unclear at this stage, it therefore also remains unclear whether bonus season will have the usual jobs merry-go-round effect.

The significantly increased time to fill roles reflects the environment in which organisations are currently operating; interview processes and headcount sign-off are quite clearly delayed for a number of reasons.  Firstly, finding the right person is absolutely paramount – each hire is crucial.  Secondly, negotiating and agreeing compensation and benefits packages is frequently taking longer with changes to the structure of remuneration within institutions and hiring managers facing cost pressures.  Thirdly, lack of visibility and confidence in the market means it can be genuinely difficult to determine the right person and the right time to hire.  The constantly changing landscape, particularly with respect to regulation also adds another layer of complexity.

We are definitely seeing the impact of this uncertainty reflected in the relatively active level of hiring activity for temporary and contract roles in financial services.  It’s encouraging to see these short term roles being released which suggests a need for skilled professionals, however it also points to a real ‘wait and see’ approach to hiring permanent employees.

Employment, Financial Services, jobs, jobseekers, London, London Employment monitor, Salaries, UK financial services professionals

In 1978, economist James Tobin proposed a tax on cross-border currency transactions. This tax would occur every time a stock, bond or derivative was purchased or sold.

This concept may now be implemented in the EU. Its aim is to slow down the number of speculative dealings and provide a vital source of revenue. A vast volume of transactions is seen to contribute to volatile currency markets and economic instability.

Economic and ethical arguments are used to support the tax. The European Commission acknowledged potential detrimental financial impacts whilst using these arguments to justify continued support. For advocates, FTT is an essential reaction to the increase in foreign exchange trading.

Opponents have reacted quickly with a number of reports being published. Current criticism focuses on the negative socio-economic impact of financial trading shifting away from the EU. In London, thousands of people work in foreign exchange markets and, according to Allister Heath, approximately 45% of currency trading is in the ‘swaps market’. Ernst and Young argued this week that FTT would damage the GDP of EU states and AIMA stated there would be significant harm to EU cross-border trade.

International financial instability calls for a new international structure but is Tobin Tax the answer?

By Beth Horne
Researcher, Tax In House & In Practice
T: +44 (0) 2070 092 0137
E: bhorne@morganmckinley.co.uk

Allister Heath, cross-border currency transactions, financial transactions tax, James Tobin, robin hood, Tax, Tobin Tax