Daily business and finance update 30th May 2023
Capping food prices
Good morning. Today we're talking about government plans to limit grocery bills, taxing the rich and the US debt deal.
Capping food prices
The government is discussing plans to encourage supermarkets to cap the price of basic foods to help with the cost of living crisis. Latest figures show that grocery inflation is 19.1%, the second highest rate for 45 years. According to reports, the scheme would be voluntary and is based on a similar initiative in France. But the British Retail Consortium, which represents the biggest supermarkets, said that it wouldn’t make any difference, with profit margins already kept very low. Adding that high food prices “are a direct result of the soaring cost of energy, transport and labour, as well as higher prices paid to food manufacturers and farmers.”
Tax reform calls
Taxing the richest 350 families in the UK by an extra 2% could raise £22bn a year, according to research by tax reform campaigners. The group said similar wealth taxes in Norway, Spain and Switzerland had helped the cost of living crisis for some of the poorest people in those countries. The richest 250 families in the UK have a combined wealth of £748bn, according to the latest Sunday Times rich list, an increase from £704bn the previous year. But less than a quarter of the 100 wealthiest people also feature on the Sunday Times Tax List of the top 100 taxpayers.
Debt deal near
President Joe Biden and Speaker Kevin McCarthy struck a deal to raise the US debt ceiling over the weekend, but it faces the major hurdle of approval in Congress. If it does go through it would limit government spending growth to 1% for the next six years and add new limits on who could receive certain welfare benefits. Democrat and Republican leaders are persuading their members to support the deal, but the compromise means neither side is happy, and there's not much margin for error. Last week, Treasury Secretary Yellen announced that the US has enough cash reserves to last to 5th June - four days longer than previously expected.
Post scandal: The Post Office has apologised after it emerged it tried to categorise some postmasters by race.
Paying the price: The Singapore state-owned investment fund says it has cut the pay of staff responsible for its investment in cryptocurrency exchange FTX, which collapsed last year.
Package change: Mars bars have been given a new look as the chocolate bar ditches its traditional plastic wrapper for more environmentally-friendly paper packaging.
Fashion fashion: New Look is in talks with its lenders about refinancing £100m of debt amid a major restructure for the fashion chain.
Parting shot: The founder of banking app Monzo has quit London for San Francisco after calling the capital ‘unfavourable’ to tech companies.
Number Of The Day
How much foreign teachers will be offered to work in English schools amid chronic staffing shortages, according to a report.
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