UK’s Resilience During the COVID Pandemic
Recently, the National Bureau of Statistics released a series of revised Gross Domestic Product (GDP) figures for the UK. The data reveals that the UK economy performed better during the COVID-19 pandemic than initially anticipated, with a stronger recovery momentum than experts had predicted.
The National Bureau of Statistics indicated that the UK economy contracted by 10.4% in 2020, which was less severe than the previously reported 11%. Additionally, in 2021, the GDP grew by 8.7%, surpassing the earlier estimate of 7.6%.
Taxpayers Need to Prepare for Increased Taxation
Next year, the UK is set to have a new round of elections. For many, the most pressing concern is what new changes will be made to their personal taxes and what tax proposals the candidates will bring?
Unfortunately, regardless of who wins, you may need to prepare for increased taxation.
According to the Financial Times, the Labour Party government has stated that it will not target the wealthy and has no plans to introduce a wealth tax, ruling out the possibility of higher taxes on capital gains and property income.
Properties Under Foreign Shell Companies Despite New UK Legislation
In February 2022, following Russia’s invasion of Ukraine, the UK government rushed to introduce the Overseas Entity Register policy in August, aiming to cleanse corrupt individuals who had laundered money through UK properties. However, critics argue that the rules had serious flaws from the outset. According to analysis, more than two-thirds of England and Wales properties held by foreign shell companies did not disclose the identities of their owners.
Tourist Tax Deters Chinese Visitors
The Oxford Economics Research Institute, commissioned by the Association of International Tourism in the UK, conducted a study on the spending patterns of Chinese tourists in the UK.
Due to the impact of tourist taxes, Chinese tourists have reduced their spending, causing significant losses to the UK tourism sector, estimated at £750 million annually. A recent report by the Association of International Tourism confirms what many businesses have been emphasizing for months: Chinese tourists are now more inclined to choose countries like Italy, France, and Spain for shopping, as they can enjoy VAT-free shopping benefits in these nations.
Thousands of UK Companies on the Verge of Collapse
Recently, the Centre for Economics and Business Research stated that the debt burden, high-interest rates, and a cost-of-living crisis during the pandemic, particularly the surge in borrowing costs due to high interest rates, are contributing to an increasing number of business closures, especially in the retail and hospitality sectors.
In the second quarter of 2023, over 6,700 companies in the UK have already gone bankrupt. The Centre reports that this level of bankruptcies is 50% higher than the same quarter before the pandemic in 2019, with a quarterly average of 4,100 bankruptcies between 2015 and 2019.
