Bank Of England Bolsters Economy

The UK's central banking organisation, the Bank of England is to inject a further £75bn into the economy through a process known as quantitative easing (QE).

The Bank has already pumped £200bn into the economy by buying assets such as government bonds, in an attempt to boost lending by commercial banks and is now to further develop its QE programme since it commenced in 2009.

The Bank also held interest rates at the record low of 0.5% after the UK economy grew by only 0.1% between April and June, which was less than previously thought.

In other financial news, a 'breakthrough tax agreement' between Switzerland and the UK, which is expected to raise billions of pounds for the UK, was signed in London yesterday.

The agreement ensures funds of UK taxpayers in Switzerland face a significant one-off deduction of between 19% and 34% to settle past tax liabilities.

From 2013, a new withholding tax of 48% on investment income and 27% on gains applying to those who have not previously told us about these assets will ensure the effective future taxation of UK residents with funds in Swiss bank accounts.

The new charges will not apply if the taxpayer authorises a full disclosure of their affairs to HM Revenue & Customs (HMRC).

The Government has already announced a new power to find out about Swiss bank accounts held by UK residents and further strong safeguards for the UK.

Exchequer Secretary, David Gauke, said: "This is an excellent agreement which tackles a problem many people thought would never be solved.

"Working with the Swiss Government we have delivered a highly effective solution which will benefit both countries and recover billions of pounds of unpaid tax for the UK."

HMRC Permanent Secretary for Tax, Dave Hartnett, said: "The world is shrinking fast for offshore tax evaders and this agreement will ensure that we know where money that flees Switzerland is heading.

"We won't be far behind," he added.

(BMcC/CD)