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UK News

Chancellor abolishes non-domiciled status

After her controversial tax status came to light in 2022, she announced she would no longer claim the remittance basis and instead pay UK tax on all her worldwide income and gains…reports Asian Lite News

Chancellor of the Exchequer Jeremy Hunt announced in the Budget on Wednesday that non-domiciled status, the tax status of Prime Minister Rishi Sunak’s wife, is to be abolished.

Hunt said the abolition of the tax regime, used by non-UK residents who do not intend to permanently live in Britain, will raise £2.7 billion per year.

Murty was saving up to £20 million annually by having the status and choosing to pay her taxes on a remittance basis, which meant she was exempt from paying UK taxes on any foreign income and gains unless she brought them to the UK. Murty gets dividends from her 0.93% stake in Infosys.

After her controversial tax status came to light in 2022, she announced she would no longer claim the remittance basis and instead pay UK tax on all her worldwide income and gains.

Hunt announced Wednesday that the non-dom tax regime will be replaced with a new system from April 2025, whereby new arrivals will not have to pay taxes on foreign income and gains for the first four years of tax residency in the UK irrespective of whether they bring the money to UK, after which they will have to pay taxes on worldwide income and gains like any UK resident.

Simon Malkiel, partner at Howard Kennedy law firm, told TOI, “Murty will not be eligible for the new regime as she has lived in the UK for more than four years so will have to pay taxes on her worldwide income and gains, as she is already doing, although she could look at putting her shares into an offshore trust.”

He said the new regime would make the UK less attractive to the very rich as they now had only four years with limited exposure to UK taxes compared to 15. “Ultra HNWs may seek to limit their time in the UK to not be UK residents at all,” he said, adding others will look to restructure their affairs to use things like offshore trusts.

“This will not happen until a year’s time and only if the government remains in power as there will be a general election before then,” he added.

ALSO READ-Hunt may extend energy windfall tax by a year

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India News Lite Blogs

Chancellor relishes ‘chai’ in Delhi’s Chanakyapuri

Meghalaya stoles were originally woven for the Khasi and Jaintia royalty, who considered them as a symbol of their power and status…reports Asian Lite News

German Chancellor Olaf Scholz was pictured enjoying a cup of tea on Sunday at a street corner in Delhi.

In a tweet, the German Embassy in India said they took Mr Scholz to their favourite tea shop in Chanakyapuri, and also shared pictures of him relishing a ‘delicious cup of chai.’

“How can you experience India without a delicious cup of Chai? We took Bundeskanzler Olaf Scholz to our favourite tea shop on a street corner in Chanakyapuri. You should all go! A true taste of India,” the embassy tweeted.

Earlier, Prime Minister Narendra Modi gifted a ‘Meghalaya Stole’ and a ‘Nagaland Shawl’ to Chancellor Scholz.

Meghalaya stoles were originally woven for the Khasi and Jaintia royalty, who considered them as a symbol of their power and status.

The weaving of Meghalaya stoles has been passed down through generations with a rich history.

Also, the shawls woven for centuries by the tribes in Nagaland are known for their vibrant colours, intricate designs, and the use of traditional weaving techniques, which have been passed down from generation to generation.

On Saturday, the Prime Minister received Scholz for a ceremonial welcome at the forecourt of Rashtrapati Bhavan.

In a tweet, Ministry of External Affairs (MEA) spokesperson Arindam Bagchi said Scholz’s visit is an opportunity to further deepen the multifaceted India-Germany strategic partnership.

ALSO READ-Scholz meets India’s best business minds

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-Top News London News UK News

UK Chancellor Jeremy Hunt joins G20 meet

The Chancellor’s work at the G20 will also contribute to the UK Government’s broader economic aims to halve inflation, grow the economy, and reduce the national debt…reports Asian Lite News

UK Chancellor of the Exchequer Jeremy Hunt is in Bengaluru to attend the G20 Finance Ministers and Central Bank Governors Meeting.

This is his first overseas visit after becoming the Chancellor. This trip is aimed to strengthen the already productive UK-India economic relationship and deepen ties to increase new investment and bring new jobs to the UK.

With its rich reputation for the cutting-edge tech industry, the Chancellor will be meeting Indian tech CEOs and founders in Bengaluru to explore investment opportunities and how links with India can help the UK become the world’s next Silicon Valley.

The Chancellor will attend the G20 alongside the Governor of the Bank of England Andrew Bailey. The Chancellor’s work at the G20 will also contribute to the UK Government’s broader economic aims to halve inflation, grow the economy, and reduce the national debt.

Jeremy Hunt, Chancellor of the Exchequer, said: “I want the UK to be the world’s next Silicon Valley – this is an ambition within reach thanks to our status as a global financial powerhouse and home to world-class universities and research institutions.”

“We already have a USD 1 trillion tech industry, but we want to go further to create jobs and wealth across the UK. To help us get there, we need to deepen investment connections with like-minded countries around the world – starting with our Indian friends who are fast becoming an economic superpower in their own right,” he said.

Alex Ellis, British High Commissioner to India, said: “The UK is working with India to solve the world’s biggest challenges, through India’s ambitious G20 Presidency. As we work towards an ambitious free trade agreement to help double UK-India trade by 2030, it is great that the Chancellor can be here in Bengaluru, India’s Silicon Valley.”

The G20 Finance Ministers meeting comes a year after Russia’s full-scale invasion of Ukraine.

On his visit, the Chancellor will reaffirm the UK’s unwavering support for Ukraine and discuss with other G20 members ways to address issues such as elevated global inflationary pressures and the instability in energy and food prices that are being exacerbated by the war.

The first G20 Finance Ministers and Central Bank Governors meeting under India’s G20 Presidency is scheduled to be held during February 24-25.

The meeting will be jointly chaired by Union Finance Minister Nirmala Sitharaman and RBI Governor Shaktikanta Das. (ANI)

ALSO READ-Lavrov to attend G20 Foreign Ministers’ meet

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-Top News UK News

Former UK Chancellor Kwasi admits he got carried away

Prime Minister Boris Johnson attended an energy round table at No11 Downing Street. The roundtable was hosted by the Chancellor of the Exchequer Nadhim Zahawi. Business Secretary Kwasi Kwarteng also attended along with CEO’s/Representatives of energy company’s. Picture by Kyle Heller / No 10 Downing Street

Reflecting on his time in office, the MP for Spelthorne said there had been “no tactical subtlety whatsoever”…reports Asian Lite News

Former UK Chancellor Kwasi Kwarteng says he “got carried away” when he announced a huge package of ill-fated tax cuts alongside former PM Liz Truss, media reports said.

Kwarteng told The Financial Times his biggest regret was being “too impatient” with the mini-budget, the BBC reported.

The plans sparked turmoil in the markets, eventually leading to Kwarteng and Truss’s resignation.

“There was a brief moment and the people in charge, myself included, blew it,” he said, BBC reported.

Reflecting on his time in office, the MP for Spelthorne said there had been “no tactical subtlety whatsoever”.

“People got carried away, myself included,” he said.

As Chancellor, Kwarteng set out a package to abolish the top rate of income tax for the highest earners, axe the cap on bankers’ bonuses, and provide an expensive and long-running energy support package.

The plans would have required more than 70bn pounds of increased borrowing, but most of the measures were torn up by his successor, Jeremy Hunt.

He was sacked from the position after just 38 days, becoming Britain’s second shortest-serving Chancellor, with Truss’s time as Prime Minister coming to a chaotic end shortly afterwards.

Kwarteng, who is a long-time ally of Truss,previously said he told her it was “mad” to sack him, saying he urged her to “slow down”.

ALSO READ-UK finance minister Kwasi Kwarteng sacked

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-Top News Europe

German Chancellor may visit India twice in 2023

The German Chancellor, during Prime Minister Narendra Modi’s visit to Germany in May, had announced support of at least 10 billion euros by 2030 under GSDP…reports Asian Lite News

German Chancellor Olaf Scholz is likely to visit India twice next year as the two countries look to strengthen bilateral relations with an emphasis on green and sustainable development.

“The Chancellor is planning a bilateral visit to India next year…. I am very confident he will come for a bilateral visit before the G-20 Summit, German Ambassador to India Philipp Ackermann told reporters here.

Ackermann said Germany and India have finalised 22 projects covering transition to renewable energy, climate resilient urban development and sustainable use of natural resources totalling one billion euros for the next year under the green and sustainable development partnership (GSDP).

The German Chancellor, during Prime Minister Narendra Modi’s visit to Germany in May, had announced support of at least 10 billion euros by 2030 under GSDP.

A large part of the support will be in the form of credit lines from KfW Development Bank with interest rates ranging from 2.7 per cent to 3.2 per cent, he said.

“All new joint ventures in India will help cut greenhouse gas emissions or help adapt to climate change. In this way, the focal points of bilateral development cooperation with India will be consistently continued and further expanded in the coming years,” Ackermann said.

The projects finalised with the Finance Ministry on Tuesday are in Meghalaya, Tamil Nadu, Himachal Pradesh and Rajasthan, he said, adding that Germany was keen on covering the whole country.

Asked about India’s G-20 Presidency, Ackermann termed the fight against climate change “one of the most urgent problems” on the political agenda and it reflected in the issues listed out by New Delhi for the year ahead.

India formally assumes the G-20 Presidency on Thursday.

“Germany will do everything to support India when it comes to making this a common effort of the G-20 countries. We are pleased that India puts this climate change very high on the agenda, Ackermann said.

The German envoy said dealing with Russia will be one of the most difficult issues during the G-20 presidency. “We have to see that this (Ukraine) conflict will remain with the G-20 in the years and the months to come. I am not a fortune teller, I don’t know what will happen next September. I am not overly confident that in two week’s time this conflict will stop. I don’t think so. I think this conflict will remain with us for a long time,” he said.

Ackermann said India has very good relations with all sides, including Russia, which can be helpful in this conflict.

“If you want to come in as a mediator, you must know the moment when you have to come in. India has very experienced and skilful diplomats, I think Indians would seize the moment if they knew there was a chance for mediation, he said.

Prime Minister Modi had visited Germany in May for bilateral talks with the German Chancellor and followed it up with another visit in June for the G-7 Summit. Germany, which holds the G-7 Presidency, had invited India as a partner country for the summit.

ALSO READ-Germany relaxes Schengen visa rules for Indians

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Economy UK News

Sunak mulls cap to annual pension rise

The Sunday Times said the finance ministry wanted to break the link between pensions and wages for a year…reports Asian Lite News.

UK Chancellor Rishi Sunak is planning to block a near 6% rise in old-age pension payments as part of a wider effort to rein in the cost of Prime Minister Boris Johnson’s spending, the Sunday Times newspaper said.

The pension promise was made during the Conservative Party’s 2019 election campaign, in which state pensions are meant to rise each year by the highest of the annual inflation rate, wage growth or 2.5%.

Due partly to distortions from the coronavirus pandemic, annual wages in the three months to April grew by an annual 5.6% – creating an extra 4 billion pound ($5.5 billion) annual cost for future pensions, it was reported.

The Sunday Times said the finance ministry wanted to break the link between pensions and wages for a year.

“Pensioners are going to be doing extremely well. It’s not politically that difficult a thing to smooth it out for a year,” the newspaper quoted an unnamed minister as saying.

Earlier, a Guardian investigation has found that a joint venture between Sunak’s billionaire in-laws and the internet retailing giant Amazon is in a multimillion-pound dispute with the Indian tax authorities,.

The disclosure adds to the list of legal battles currently involving the joint venture, following news on Friday that India’s competition commission has been given permission to relaunch an investigation into Amazon.

The Guardian reported that small traders claim they are being squeezed out of business by the multinational’s selling practices and that the US retailer’s 1 billion-pound-a-year venture with the chancellor’s father-in-law, the technology entrepreneur NR Narayana Murthy, could be bypassing Indian foreign ownership rules.

Amazon says it is operating in full compliance with local laws.

ALSO READ-Sunak warns of taxing times ahead

READ MORE-‘Sunak’s in-laws face £5.5m demand in Amazon India tax dispute’