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UK airlines call for the tax break to help boost demand

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airplane travel

Every industry sector has taken a massive hit from the ugly Covid-19 pandemic of 2020. The coronavirus has affected everything for as far as you can see, and even beyond that. Of course, some industries have taken a more severe hit than others- the airline industry being one of them.

One of the essential preventive measures that we have learned to take during this Covid-19 pandemic is social distancing and home isolation. Since the coronavirus is a global pandemic, affecting every country, there is hardly any safe place left for us to retreat to. Being in closed spaces for some time with others is also forbidden, which makes travel and tourism, primarily via air travel, completely closed off as an option.

In the UK, it has been noted that the airlines, ground handling, and even airports have received some amount of relief from the government. This has come in the form of loans as well as government employment support schemes. However, there has still not been any specific package from the government for the industry. Taking this into account, several UK airlines have requested a tax break, which can help the industry boost their demand and, thus, stand up on their feet once again.

 A group which represented some UK airlines such as British Airways, Ryanair and EasyJethave called on the government to allow a suspension of tax on their flights. The airlines feel that this will help them to boost their demand, after having faced a severe fall due to the coronavirus pandemic. 

What exactly do the UK airlines have in mind?

The Covid-19 pandemic has affected the airline industry in a whole and harsh way. Although the airlines and airports have received great help, the industry itself is still suffering. Keeping this in mind, the UK airlines have asked the government to waive Air Passenger Duty for at least one year. This will help to save up to 8,000 jobs and also save routes in this industry, which has faced immense loss due to the coronavirus. By now, there have already been up to 30,000 job cuts, and there could still be many more to come.

 A sharp contrast is noticed in other European countries, where the government has stepped up to help quite instantly. Countries like France have granted their airline industry Air France around 7 billion Euros in the way of state-backed loans and other air. This aid has been immensely advantageous to the industry, helping them survive in these dire times.

Are tougher times coming up?

Several UK airlines have voiced their concerns over the upcoming winter season. They have stated that this season is particularly hard on the airline industry, as fewer people prefer to travel. With the winter creeping up steadily, the UK airline industry needs some form of aid at the earliest possible from their government to stay on their feet.

Tim Alderslade, the Airlines UK CEO, expressed concern that without adequate Government support for the airline sector, the UK airports run a genuine risk of losing some valuable routes, and of course, suffering enormous financial losses. An emergency APD waiver can help the airline industry get through the harsh wintertime and also go along the road of recovery.

This APD waiver could necessarily help in boosting the passenger demand in their industry by at least 12% in the coming 12 months.

What is APD tax?

APD tax, or Air Passenger Duty tax, is a tax that is added by the government on passenger flights in the UK. The tax adds about 13 more pounds to their airfares for passengers, for just an economy flight between the United Kingdom and Europe. However, when this APD tax is added to other kinds of flights, such as long haul flights in business class, then the additional price may amount to 170 pounds more.

How can reducing or removing APD tax be beneficial?

Heathrow has held a long-standing position that APD tax is unnecessary and a burden on competitiveness, investment, and tourism. The policy change would necessarily not impact transfer passengers flying on domestic routes.

The total cost savings that could be made by UK passengers could cause a potential increase in demands. Along with that, it could also stimulate up to an 8% increase in point-to-point demand on domestic routes (Heathrow) under a 100% reduction scenario. This could, potentially, equate to around 75,000 more round trips per annum. In the case of a 50% reduction scenario, the increase in demand could be seen up to 4%, which is equivalent to around 37,000 round trips.

By reducing the APD tax, not only do the domestic passengers get immense benefits, but passengers flying on local routes in the UK could also enjoy several benefits.

The reduction of APD tax can also reduce the cost of air travel expenses to and fro from other UK regions. Under the 100% reduction scenario, this could reduce the price up to 225 million euros per year. Under the 50% reduction scenario, it could see a reduction of 112 million Euro per annum.

What other benefits could be seen by reducing or wavering APD?

If the government were to waiver the APD taxes for at least a year, it could also enable several IT businesses as well as financial service sectors in Northern Ireland and Scotland’s main cities to retain their strong links with London, and even beyond. It could foster the trading of knowledge with the cost-efficient flights.

Not just that, this APD tax break could also improve the viability of newer domestic connections, as the cost of air travel for passengers would significantly reduce.

The proposal has been set in front of the UK Government, who will review it and inform the airline industry of their decision. Of course, it can be seen how this tax break can help in boosting passenger demand for domestic flights, and help out the airlines industry to overcome this unforeseen disaster. Although the Government aid provided to airports and airlines is being applauded, this move could be a lifesaver for the UK airline industry.

If your business is facing hardship or you are worried about debt or taxes, then we urge you to act as soon as possible.

Claims and disputes involving taxes are highly technical. Contact one of our proactive and professional commercial law solicitors now for expert legal advice.

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Reasons for Choosing Temporary and Permanent Industrial Buildings

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Professional temporary solution providers have become very innovative in designing industrial buildings. While temporary industrial structures are made of lighter materials such as aluminum and fabric or PVC covers, permanent solutions are made of steel or metal frames and sheets. All of them require good preparation of the ground, pre-fabrication of the frames and sheets, and proper installation to serve their purpose well.

Most beneficiaries of these structures are processing factories, manufacturing plants, sports clubs, schools, and many other organizations and companies. Choosing temporary and permanent industrial buildings from a reputable supplier has many perks.

So, let us dive into the reasons for choosing temporary and permanent industrial buildings to understand this topic better.

Amazing Speed of Constructions

Bye-bye brick and mortar industrial buildings that are time-consuming. Temporary and permanent industrial buildings are the way to go because they are fast and easy to fabricate and install using modern technology.

According to experts, these structures save a lot of time, especially if the frames and panels are already fabricated in the factory. Companies that need to set up new companies or expand the current ones will have everything ready in a matter of a few weeks.

Excellent Cost Saving

The economy is hard enough and the investor needs to save on capital when setting up companies or doing expansions. The good news is that temporary and permanent industrial buildings save costs by up to 30% when done by a professional company.

Smart-Space is not only innovative in their technology but they save you a lot of money when setting up your industrial structures. You can rent these structures if you only need them for a short time to save more money.

Absolute Flexibility and Versatility

If you are looking for structures that can be moved after a few years, then temporary and permanent industrial buildings are the way to go. As mentioned, they are made of frames and panels that are fastened together using bolts. Hence, they are easy to dismantle and move to a different location.

However, this work should be done by professionals to reduce damage and ensure the safety of the structures at all times.

High Level of Customization

If you are looking for functional sizes and unique designs that will maintain the theme of your company or organization, the temporary and permanent industrial buildings done by experts will be best. After a discussion of what will serve your business well, the solution provider will take a few days to do the designs with your preferred sizes and colors.

Customization also applies during the extension of an existing factory where everything is done to your preference or in the best possible way. To achieve a high level of customization, you should consider experienced solution providers.

Surprising Durability

Both temporary and permanent industrial buildings are surprisingly durable. Take steel industrial structures for example. They provide service for many years without the need for complicated maintenance. Since steel does not rust, the structure will withstand harsh weather conditions including moisture.

Structures made of metal frames and fabric are equally durable, especially when used as recommended. They also require low maintenance with no paintwork needed after every few years.

Manufacturer’s Warranty

The buyers of temporary and permanent industrial buildings enjoy different manufacturer’s warranty benefits. This could be the bought structures or the materials used to make them. What’s more is that many reputable service providers also give warranties on the workmanship, which will save cost when there is a problem.

Conclusion

To enjoy all of these benefits, it is good to buy or lease your temporary and permanent industrial buildings from a reliable and trusted supplier. Well, there are even more benefits that you will realize once you start using these structures. So, make the right choice now.

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New ways of thinking and working are necessary to reap blockchain benefits in capital markets

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The World Economic Forum today released Digital Assets, Distributed Ledger Technology, and the Future of Capital Markets. Across the capital markets ecosystem, institutions are facing a combination of intensified competitive dynamics and accelerating technology advancements, presenting opportunities and challenges both to incumbents and new entrants. Although DLT is not a panacea, the report underlines how it can positively impact costs, market liquidity and balance sheet capacity while reducing the complexity, opacity and fragmentation of capital markets.

Written in partnership with the Boston Consulting Group (BCG), the report is based on nearly 200 interviews and eight global workshops with capital market incumbent players, new entrants, regulators and governments. It presents use cases from equity markets, debt markets, securitized products, derivatives, securities financing and asset management.

DLT can address real challenges and inefficiencies in some markets by providing a trusted, shared source of truth between market participants. However, the future is uncertain as there is no agreed path for market-wide adoption. What’s more, as institutions still decide where to invest, varying strategies create tensions.

The report calls for a balance between innovation and market safeguards through standardization, the breaking down of silos and regulatory engagement. According to the authors, fundamentally transforming markets will require new ways of thinking and working across the industry.

“Following several years of intense hype, examples of use cases where inefficiencies and challenges are being solved with blockchain are starting to emerge across capital markets,” said Matthew Blake, Head of the Future of Financial Services, World Economic Forum. “With the future for blockchain in financial services still being defined, a nuanced look at the opportunities this technology offers right now is particularly important for the financial services industry.”

“Distributed ledger technology has come of age as it begins to enhance efficiencies, reduce operating costs and create new business models in capital markets, but the use cases and solutions are respective to each asset class,” said Kaj Burchardi, Managing Director, BCG Platinion. “Whilst this makes sense from a commercial perspective, it has led to a complex patchwork of initiatives. For capital markets to unilaterally adopt DLT, they will require cross-institutional alignment to realize the game-changing market opportunities it can offer.”

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Russian Nornickel signed a deal with UK chemicals giant Johnson Matthey

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Russian Nornickel, the world’s largest metal producer has signed a deal with Johnson Matthey (JM) on long-term supply of critical metals for their battery materials production in Finland.

The Finnish government is actively developing production sites for battery components. Finnish budget for 2021 includes additional funding of EUR 300 million for Finnish Minerals Group to promote investments for the production of precursor and cathode active materials used in lithium-ion batteries in Finland.

Earlier in April Nornickel announced plans to ramp up sustainable nickel and cobalt production at its refinery in Finland — NN Harjavalta — in response to the growing European demand for high quality and responsibly sourced metals for the EV industry. NN Harjavalta’s product range will be playing an important role in satisfying Johnson Matthey’s requirements for its precursor and cathode active materials production in Finland as well as for its existing factory in Poland.

Johnson Matthey announced the development in Finland of its second commercial plant with a nameplate capacity of 30 kt of ultra-high energy density cathode materials required by EV producers. The factory will be powered solely by renewable energy and incorporate an innovative effluent treatment solution.

Nornickel and Johnson Matthey have also signed a memorandum of understanding to explore options to further extend metal supply in the future. The parties also intend to collaborate in other important parts of the battery materials value chain, including new metal dissolution technology, circular economy opportunities, and tokenization of the supply chain using blockchain technology. Implementation of token-based smart contracts allows combining metal deliveries with complete provenance as well as ESG credentials including carbon footprint to ensure the unprecedented level of responsible sourcing.

The deal will allow the Russian and British company to define joint sustainable development initiatives.

“We are delighted for this opportunity to develop our business together with Johnson Matthey — a new important player in the Finnish battery materials ecosystem — and help the company expand on the European EV market. Our memorandum should enable us to identify mutually beneficial sustainability initiatives that support the ambition of achieving the most sustainable battery materials value chain in Europe,” commented Vladimir Potanin, President of Norilsk Nickel.

Earlier, Norilsk Nickel signed a letter of intent to establish a battery recycling cluster in Harjavalta, Finland, to serve the electric vehicle market in partnership with Finnish energy company Fortum and German world’s leading chemical company BASF. This will successfully complete the “closed loop” recycling cycle for critical metals present in used batteries.

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