Business News England: Inflation, Export Guarantees & Tax Updates

Welcome to our latest roundup of business news updates. These insights are designed to help you stay informed about changes impacting your business.

If you have questions or need advice on how these updates affect your business, please get in touch. We’re here to support and guide you!

Inflation on the Rise: What October’s Figures Mean for Businesses

The Consumer Prices Index (CPI) for October 2024 rose to 2.3%, up from 1.7% in September, according to the Office for National Statistics (ONS). This marks the first rise in inflation since July, creating ripple effects for businesses, policymakers, and consumers.

While the increase was expected, the Bank of England has already signalled that any future base rate cuts will happen gradually. The latest CPI figures make it unlikely that rates will drop further when the Bank meets in December.

Key Drivers of Inflation

The ONS highlights higher energy costs as the primary contributor to October’s inflation. However, some factors helped offset the increase:

• Falling ticket prices for live music and theatre.
• Lower raw material costs, easing business expenses.

Despite these offsets, certain sectors faced notable price hikes:

• Services inflation (e.g., haircuts, hotels, and airfares): Rose to 5%.
• Alcohol and tobacco: Prices increased sharply.
• Food inflation: Remained unchanged from September.

Impact on Businesses

The inflation rise, while modest, presents specific challenges and opportunities:

1. Energy Costs

• Reassess energy usage for potential savings.
• Explore alternative suppliers or pricing plans to manage rising costs.

2. Pricing Strategies

• For service-based businesses, rising costs affect consumer spending.
• Balancing price adjustments with value-added offerings will help retain customer loyalty.

3. Cost Control

• With raw material costs falling, manufacturers and retailers should consider locking in favourable supply contracts.
• Reassess profit margins to ensure long-term sustainability.

Economic Outlook

The Bank of England projects inflation to rise temporarily before easing in 2025. For now:

• Interest rates are unlikely to increase sharply, but further rate cuts may be slower than hoped earlier this year.
• Businesses should plan for borrowing costs to remain relatively high in the short term.

While October’s inflation figures indicate a mild uptick, sector-specific challenges—particularly in energy and services—highlight the importance of flexibility and proactive planning.

By fine-tuning strategies and maintaining cost efficiency, businesses can turn this period of inflationary growth into an opportunity for resilience and innovation.

See: ONS Consumer Price Inflation

New UKEF Guarantee Boosts Opportunities for UK Engineering, Design, and Technical Services Firms

UK Export Finance (UKEF), the UK’s export credit agency, has launched the Early Project Services Guarantee (EPSG), an initiative aimed at helping British engineering, design, and technical services firms secure international contracts.

This new scheme is designed to make UK expertise more attractive to overseas buyers by filling a financing gap for the early stages of major projects.

How the EPSG Works

• Payment Guarantee for Overseas Buyers:
• The EPSG provides overseas buyers access to private finance by guaranteeing their payments to lenders. This makes it easier for international buyers to select UK firms for critical scoping and design work during the planning phase of projects.
• Lifecycle Financing Advantage:
• Once the early stages are complete, buyers can refinance their loans as part of the larger project financing for the construction phase. This creates an integrated financing solution, giving UK firms a competitive edge for securing contracts in international projects’ early planning and construction phases.
• Bridging the Financing Gap:
• The EPSG addresses a longstanding gap in market provision for funding the preparatory phases of major projects, providing vital support for the UK services sector and driving export growth across all regions of the UK.

Benefits for Your Business

For UK firms offering engineering, design, and technical services, the EPSG offers:

• Increased Global Competitiveness: The scheme makes UK expertise more appealing to international buyers.
• Access to New Markets: Opens the door to securing contracts in the early and later stages of major projects.
• Export Growth Opportunities: Provides a robust platform to expand your business internationally.

How We Can Help

This new scheme could be a game-changer if your business is in the engineering, design, or technical services sector. We can:

• Help you understand how the EPSG works.
• Provide tailored advice on how to take advantage of this scheme.
• We support you in exploring broader opportunities to export your services globally.

Feel free to contact us to discuss how the EPSG could help your business grow and thrive in international markets.

See: UK Government News – New Export Guarantee Champions UK Services

Government Proposes Crackdown on “Subscription Traps”

The UK Government has launched a consultation to address “subscription traps”, which often prevent consumers from easily cancelling unwanted subscriptions due to unclear terms or complex processes. The proposed measures aim to improve transparency and simplify cancellations, potentially saving UK households up to £1.6 billion annually.

The Problem: Trapped in Subscriptions

“Subscription traps” arise when consumers:

• Are misled into subscribing via free trials or introductory offers.
• Encounter unclear terms or difficult cancellation methods.

Recent statistics show nearly 10 million unwanted subscriptions in the UK out of 155 million active ones. On average, these cost consumers £14 per month. Common industries include:

• Magazines
• Streaming services
• Beauty boxes

Businesses often use lengthy cancellation processes, such as requiring phone calls during restrictive hours, making it harder for consumers to opt out.

Proposed Solutions

The government’s proposals include:

1. Simpler Cancellation Processes
   Businesses will need to offer easy and accessible ways for customers to cancel subscriptions.
2. Clearer Communication
   • Consumers would receive reminders before trial periods end or contracts auto-renew.
   • This ensures better awareness of future charges.
3. Improved Refund Rights
   Refund processes will be strengthened for:
   • Cancellations within the 14-day statutory cooling-off period.
   • Instances where businesses fail to meet their obligations.

Next Steps

The consultation is open to:

• Businesses offering subscription-based services.
• Consumer advocacy groups.
• Enforcement agencies.

The aim is to strike a balance between protecting consumers and ensuring businesses can continue to provide subscription models effectively.

How to Participate

For more information and to provide feedback, visit:

UK Government Consultation – New Subscription Contracts Regime

If your business offers subscriptions, this is an opportunity to influence potential regulations and prepare for upcoming changes. Contact us for advice on how these proposals may impact your operations. We’re here to help!

Stay Safe During Black Friday Season

The National Cyber Security Centre (NCSC) has revealed worrying statistics, showing that shoppers lost over £11.5 million to online scams between November 2023 and January 2024, with an average loss of £695 per victim. This is an increase from the £10.6 million lost the previous year.

Black Friday offers fantastic opportunities for businesses and shoppers to secure bargains, but it’s also a peak time for fraudulent activities. Criminals are increasingly targeting online transactions during this period.

Common Scammer Tactics

Online fraudsters often use deceptive strategies, such as:

• False urgency: Fake limited-time offers to rush decisions.
• Scarcity tactics: Advertising rare or exclusive items to entice buyers.

How to Protect Yourself and Your Business

1. Be Alert for Suspicious Behaviour
   • Avoid clicking on unfamiliar links or sharing personal information.
   • Break contact if anything seems suspicious and verify the seller’s authenticity through trusted review platforms.
2. Secure Your Online Accounts
   • Activate two-step verification for all accounts.
   • Use strong, unique passwords to protect sensitive information.
3. Educate Your Team
   • Train employees involved in purchasing to recognise potential scams and follow secure practices.

Stay Informed

By taking these precautions, you can reduce the risk of fraud while making the most of seasonal offers.

For more guidance, visit:

Black Friday Warning: Rising Losses to Scams

Stay vigilant and shop securely this Black Friday!

Are You Ready for New B2B Parcel Arrangements Between Great Britain and Northern Ireland?

From 31 March 2025, new rules for business-to-business (B2B) parcel shipments between Great Britain (GB) and Northern Ireland (NI) will take effect under the Windsor Framework. These changes were initially set for 30 September 2024 but have been delayed to allow businesses more time to prepare.

Key Changes for B2B Parcels

1. Customs Declarations via CDS:
   • Information for B2B parcels must be submitted through the Customs Declaration Service (CDS).
   • Parcel carriers will handle this process but may require additional information from you, such as details about the goods.
   • Duty payments may also apply.
2. UK Internal Market Scheme (UKIMS):
   • With UKIMS authorisation, eligible goods can move without full customs declarations or duty.
   • UKIMS applies if goods are for sale or final use by end consumers in the UK and are not subject to EU trade remedies.
   • If you don’t yet hold a UKIMS authorisation, you should apply now to ensure a smoother transition by the March 2025 deadline.

B2C Parcels

• Goods sent to consumers for personal use do not require individual customs declarations, duty payments, or presentation to customs authorities.
• Parcel carriers will need basic data, such as:
  • The recipient’s details.
  • A description of the goods.

Steps to Prepare

1. Determine Customer Type:
   • Understand whether your customer is a business or a consumer.
   • Indicators include:
     • Business accounts.
     • VAT invoice requests.
     • Large or frequent orders.
2. Apply for UKIMS Authorisation:
   • Simplify your B2B parcel processes and avoid additional costs by obtaining UKIMS approval.
3. Talk to Your Parcel Carrier:
   • Confirm how they will manage the new requirements and what information they will need from you.

Final Thoughts

With distinct processes for B2B and B2C shipments, it’s crucial for businesses to adapt to these changes in advance of the deadline. Starting preparations now, including securing UKIMS authorisation and aligning with your parcel carrier, will ensure a seamless transition.

For full guidance, visit:

Moving Parcels from GB to NI Under the Windsor Framework

Business Rates Reforms: What It Means for You

The UK government has published legislation to implement business rates changes announced in the recent Budget. These reforms, effective from the 2026/27 tax year, aim to create a more balanced system, providing benefits for smaller retail, hospitality, and leisure (RHL) businesses while shifting some of the burden to higher-value properties.

Key Highlights

Relief for Retail, Hospitality, and Leisure (RHL) Sectors

• Smaller Properties Benefit:
  • Properties with a rateable value below £500,000 will benefit from two permanently lower business rates multipliers, reducing tax bills.
  • This change aims to help smaller high-street businesses reinvest in growth, staffing, or other priorities.
• Stability for RHL Businesses:
  • Temporary relief measures for RHL sectors will become permanent, allowing businesses to plan with greater certainty.
  • This is critical as high-street businesses face challenges like declining footfall, with some areas reporting significant drops in activity.

Larger Properties Face Higher Rates

• Properties with a rateable value of £500,000 or more will be subject to higher multipliers, increasing their rates.
• This shift redistributes the tax burden to fund reduced rates for smaller businesses sustainably.
• Large warehouses, particularly those used by e-commerce giants, are expected to bear a significant share of the increase.

How to Prepare

1. Assess Your Properties:
   • Review the rateable values of your properties to understand how the changes will affect your business.
2. Verify Your Current Rates Bill:
   • Ensure your properties are correctly valued and assessed. If adjustments are needed, work with your local authority now, as this process can take time.
3. Plan for Rate Increases:
   • Businesses with larger, premium, or urban properties should start budgeting for higher rates to avoid surprises.

Looking Ahead

• The government will confirm precise definitions for qualifying businesses and the exact multipliers by Autumn 2025.
• While smaller businesses can look forward to long-term relief, larger property holders should proactively plan for increased costs.

If you’d like to discuss how these changes might impact your business, please get in touch. we’re here to help you navigate these reforms.

For more details, visit: Business Rates Bill.