FirstFT: Hunt to raid electricity generators with new tax

Jeremy Hunt is preparing a raid on electricity generators with a brand new tax on their “extra returns” as he tries to search out cash to pay for an inflation-linked rise in advantages and pensions whereas extending assist for households with vitality payments.

The chancellor can even use Thursday’s Autumn Assertion to raise the prevailing windfall tax on oil and gasoline corporations — generally known as the “vitality earnings levy” — from 25 per cent to 35 per cent, whereas extending it for one more two years till 2028.

The federal government had been contemplating a “income cap” on electrical energy turbines according to the same transfer by the European Union.

Now Hunt is making ready a tax of 40 per cent on the “extra returns” from the sector above a sure value per megawatt hour, based on individuals near the discussions. That threshold has not but been determined.

The 2 windfall taxes are anticipated to generate greater than £45bn over six years, though the ultimate determine will depend upon vitality costs.

Do you agree with Hunt’s new windfall tax on electrical energy turbines? Let me know at firstft@ft.com. Right here’s what different readers needed to say about whether or not Thursday’s Autumn Statement would ease the price of dwelling:

“My pension assertion yesterday for retirement in 2024 confirmed large losses. It’s painful, however we’ve got to deal with much less” — Chris Keates Lewis in Ashtead, UK

“Extra taxes on individuals incomes beneath ‘roughly’ £1mn and belt tightening on public service will result in a worse recession, much less spending and fewer development” — Ben Cobley in Portsmouth, UK

“Dwelling as I do in a rustic with greater than 84 per cent annual inflation, and receiving a Turkish lira wage, with a household to assist, I do discover it considerably humorous to see individuals within the UK complaining of 10 per cent” — Julian Bennett in Ankara, Turkey

5 extra tales within the information

1. HMRC sues EY over alleged misrepresentations The UK’s tax authority is suing the Big Four accounting firm over alleged misrepresentations made throughout the negotiation of a tax settlement regarding British property investor and Conservative donor Jamie Ritblat.

2. CIA director warns Russia towards nuclear weapons use Within the first recognized in-person assembly between senior US and Russia officers since Vladimir Putin’s invasion of Ukraine, Invoice Burns “conveyed a message on the consequences” of using nuclear weapons, the White Home mentioned yesterday.

3. Amazon to chop 10,000 jobs The ecommerce large plans to axe about 3 per cent of its corporate workforce in an effort to chop free lossmaking or underperforming items of its enterprise, an individual accustomed to its plans mentioned. The information got here the identical day as former chief government Jeff Bezos pledged to give away most of his $124bn fortune.

4. FTX chapter case stalls Sam Bankman-Fried’s crypto change had not filed so-called first-day motions to formally commence bankruptcy proceedings as of yesterday, based on courtroom information, reflecting disarray inside FTX after it sought US courtroom safety from collectors final week.

5. World inhabitants reaches 8bn The world’s inhabitants reaches 8bn people today and can hit 9bn in 15 years because it experiences an unprecedented surge within the variety of pensioners, based on the most recent UN knowledge. It additionally confirmed the worldwide median age had elevated about eight years to 30 since 1950 and was set to rise to 36 by 2050.

The day forward

G20 summit Seventeen leaders of the world’s largest economies are anticipated to attend the gathering in individual, united by fears about runaway inflation, geopolitical instability and vitality shortages. Though Vladimir Putin has determined to not be a part of the assembly, which begins in Bali right now, the Russian president will dominate discussions about his war in Ukraine.

Belgian courtroom guidelines on GFG A courtroom within the metropolis of Liège will resolve whether to take control of two metal crops held by Sanjeev Gupta’s GFG Alliance and put them up on the market following a request by a court-appointed judicial observer.

Financial indicators September unemployment knowledge is ready to indicate the UK nonetheless under pre-pandemic ranges. One other “winter of discontent” is looming as a spread of employees, most not too long ago nurses, demand pay rises according to inflation. The EU’s third-quarter gross home product estimate can be anticipated to level to a contraction forward of winter.

Company earnings Vodafone publishes interim outcomes. Shareholders will probably be trying on the quantity the British telecommunications firm has been capable of lower after asserting the sale of its stake in Vantage final week. Different corporations because of report embrace Imperial Manufacturers and Infineon Applied sciences. View the full list here.

US-China Financial and Safety Assessment Fee report The US congressional committee will put out its annual report, which is more likely to be more hawkish about decoupling than up to now, writes Rana Foroohar.

Donald Trump announcement The previous US president has teased a “very big announcement” scheduled right now at his Florida Mar-a-Lago property. Trump is predicted to declare his intention to run within the 2024 presidential election, however a lacklustre efficiency by candidates he endorsed within the midterms poses a setback to his ambitions.

What else we’re studying and watching

Cracks within the US Treasury bond market As recession looms and most asset costs face a dramatic sell-off, the world’s most essential debt market is creaking as soon as once more. With the meltdown in UK gilts exposing the vulnerability of bond markets, can the US survive a wave of selling?

The worldwide housing market is heading for a brutal downturn On the finish of 2021, issues seemed rosy for the worldwide housing sector. Arguably, there had by no means been a greater time to personal a house. Not even a yr later, the sector is now braced for the broadest slowdown since the financial crash.

As world’s eyes flip to COP27, Egypt battles local weather change The host of this yr’s UN convention is “extremely vulnerable” to global warming, based on studies cited by the World Financial institution, with farmers struggling to make ends meet in unpredictable climate that’s now the “new regular”.

Britain’s tussle over medicines Prescription drugs bleating about UK pricing is hardly new, significantly from US corporations used to the inefficient largesse of their very own system. However the sector may have a point about a new deal to restrict the dimensions of the NHS medicine invoice, writes Helen Thomas.

Qatar’s World Cup legacy In our newest FT Movie, we have a look at what the football World Cup means for the country, and what’s going to occur to stadium infrastructure and the Fifa match after. For extra on the enterprise of sport, Premium subscribers can sign up for our Scoreboard newsletter.

Wine

Ridge Vineyards, the Silicon Valley vineyard based by 4 Stanford scientists of their spare time, celebrates its seventieth anniversary this yr and the FT’s wine critic Jancis Robinson was invited to taste some of its vintage bottles as a part of the festivities.