The UK and Switzerland have signed a declaration to begin negotiations on tax issues in a step towards making Britons with Swiss bank accounts pay tax on the interest they earn.
Switzerland has strict secrecy laws and has long attracted the very wealthy as a place to save their money.
Treasury sources said negotiations were in the early stages and no details of tax rates had been agreed.
An agreement between Liechtenstein and the UK is expected to raise about �1bn.
Any agreement between the UK and Switzerland may raise more than that as there are more accounts in Switzerland.
Withholding tax
The declaration followed talks between UK Chancellor of the Exchequer George Osborne and the Swiss Finance Minister Hans-Rudolf Merz in London.
Formal negotiations will cover the possibility of implementing a withholding tax, which would see Swiss authorities levying a tax on interest earned in their accounts on behalf of HM Revenue & Customs. The UK would push for this to be a retrospective tax.
The UK is also expected to push the Swiss authorities to provide more information on accounts held by UK taxpayers.
In parallel talks, Germany has also agreed in principle to Switzerland introducing a withholding tax on the assets of German taxpayers with Swiss accounts.
Last year the G20 ordered a worldwide clampdown on offshore tax havens.
The Independent newspaper has launched a new daily title, called "i", aimed at attracting "readers and lapsed readers of quality newspapers".
The new concise paper, which will cost 20p, will share the same editorial staff as The Independent.
The Independent's owner, Russian tycoon Alexander Lebedev, also owns London's Evening Standard newspaper.
Last year, the Standard became a freesheet and has seen its readership increase sharply as a result.
There had been much speculation that the Independent and the Independent on Sunday, which Mr Lebedev bought in March from Irish company Independent News & Media (INM) for �1, would also become free papers.
'Revive a brand'
"Time-poor newspaper readers, and especially commuters, have been telling us for years that they are inundated with information and just don't have the time to read a quality newspaper on a regular basis," said Independent executive Andrew Mullins.
Evgeny Lebedev, the son of Alexander Lebedev and the chairman of Independent Print Ltd which publishes the British titles, said he was confident that launching "i" would be a success.
"We have shown by our investment in the London Evening Standard that, even in these highly competitive times, it is possible to revive a brand," he said.
The UK's 11 major national daily newspapers have seen their circulation shrink an average 5.75% in the last year to 10.3 million copies a day, according to industry figures.
The more expensive quality papers have suffered more than the cheaper tabloids.
The Daily Telegraph, The Times and The Guardian have each suffered a drop in circulation of more than 10% over the last year.
Sales of The Independent, which costs �1, have fallen to just over 186,000 a day from about 250,000 three years ago
NEW YORK (Reuters) - U.S. stocks rose to a five-and-a-half month high on Monday as a falling dollar, partly driven by expectations of further stimulus by the Federal Reserve, prompted investors to buy riskier assets.
The slide in the greenback continued after a weekend meeting of the Group of 20 stopped short of setting targets to reduce trade imbalances. Bets the Fed will stimulate growth by effectively printing money to buy assets has weakened the dollar, which in turn has lifted commodity prices.
"We have a lower dollar, we have low and benign interest rates, and you can't beat that combination for reflating the economy or stock prices," said Hugh Johnson, chief investment officer of Hugh Johnson Advisors LLC in Albany, New York.
Equities and the dollar have formed an inverse relationship, so as the dollar drops, equities often advance. Since September 1, the S&P has risen 13 percent while the dollar index .DXY, which measures its value against major currencies, has lost 7.4 percent.
The S&P materials sector .GSPM, which is particularly sensitive to the weak dollar, gained 1.7 percent and was the index's best performing group. Freeport-McMoRan Copper and Gold Inc (FCX.N) advanced 2.2 percent to $96.07.
But stocks finished the session well off their highs as the dollar came off its lows late and the euro pared gains.
"It's all about the currency -- the dollar strengthened and euro faded," said Stephen Massocca, managing director at Wedbush Morgan in San Francisco.
"Commodities, including copper, also did the same thing, their gains were lost toward the market close."
The Dow Jones industrial average .DJI gained 31.49 points, or 0.28 percent, to 11,164.05. The Standard & Poor's 500 Index .SPX added 2.54 points, or 0.21 percent, to 1,185.62. The Nasdaq Composite Index .IXIC advanced 11.46 points, or 0.46 percent, to 2,490.85.
The benchmark S&P 500 index ended at its highest since May 3.
In a research report, Goldman Sachs said the Federal Open Market Committee is almost certain to announce renewed monetary easing at its November 2-3 meeting.
Goldman analysts calculated the Fed may have to buy up to $4 trillion in assets to achieve desired growth and inflation targets.
Further boosting materials stocks was Eastman Chemical Co (EMN.N), which climbed 5.1 percent to $82.59 after it agreed to sell three plants to Mexican conglomerate Alfa (ALFAA.MX) for $600 million.
After the closing bell, chipmaker Texas Instruments Inc (TXN.N) shed 0.4 percent to $28.86 while biotech company Amgen Inc (AMGN.O) lost 0.6 percent to $57.60 after posting quarterly results.
During the session, Office Depot Inc (ODP.N) and tobacco company Lorillard Inc (LO.N) rallied after posting stronger-than-expected profits. Office Depot also said that its embattled chief executive would be stepping down, sending the stock up 3.5 percent to $4.79. Lorillard advanced 1.3 percent to $85.14.
WASHINGTON (Reuters) - Sales of previously owned U.S. homes rose a greater-than-expected 10 percent in September but remained at depressed levels that point to a painful and protracted recovery for the housing market.
The rise took sales to an annual rate of 4.53 million units, the National Association of Realtors said on Monday. It was the second monthly gain and far outstripped economists' expectations for an increase to a 4.30 million-unit pace.
Still, the data did little to weaken the case for further monetary easing from the Federal Reserve, with sales far below the 5 million-unit pace usually associated with a healthy market.
"This is relatively goods news but the housing market situation has a long way to go before it fully recovers," said Chris Christopher, a senior economist at IHS Global Insight in Lexington, Massachusetts.
The report had little impact on U.S. financial markets as investors continued to look ahead to the November 2-3 Fed meeting at which officials are expected to decide to inject more money into the economy through bond purchases to drive borrowing costs lower and stimulate demand.
Expectations of further Fed easing pushed the U.S. dollar to a fresh 15-year low against the yen and weakened it against most major currencies. Stocks on Wall Street rose to a 5-1/2 month high as traders anticipated a looser monetary policy and piled into riskier assets.
Prices of U.S. government debt drifted mostly lower as traders booked profits from a rally early in the session.
STABILITY AT LOW LEVELS
The Fed cut overnight interest rates to near zero in December 2008 and has already bought about $1.7 trillion worth of Treasury and mortgage-related debt. That helped push mortgage rates to historic low levels.
The housing market is showing signs of having bottomed after hefty declines in the aftermath of the end of a popular tax credit for home buyers earlier this year.
Activity, however, remains very subdued and the recovery is expected to be very slow given the 9.6 percent U.S. unemployment rate. A cloud of uncertainty from investigations into the processing of foreclosures by some banks looms over the sector, which was at the heart of the 2007-2009 recession.
Last month, foreclosed properties accounted for 23 percent of sales while short sales made up 12 percent. The combined percentage was up slightly from August. First-time buyers accounted for 32 percent of transactions in September.
There are concerns the foreclosure investigation could slow the housing market correction as banks hold back on sales. According to the NAR, foreclosed properties constitute about 20 percent of homes on the market.
The industry group said a survey of its members taken two weeks ago showed buyers were becoming hesitant to snap up foreclosed properties, worried they might not be dealing with the lawful owner.
Sales of single-family homes and condominiums both rose, the report showed. A 1.9 percent fall in the supply of houses available for sale to 4.04 million units also offered a sign of increased stability in the market.
Business Secretary Vince Cable: ''We have every confidence that the economy will continue to grow''
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Business Secretary Vince Cable has called for a comprehensive rethink about how UK companies are run and how they should be bought and sold.
He told the CBI annual conference that economic growth would come from investment and business.
On the issue of pay, he said executives should "return to Planet Earth".
Meanwhile, the CBI has warned that the UK will need to work hard to maintain its position against rising global competition for business investment.
In his speech, Mr Cable emphasised that "Britain must be open for business", adding that growth would also have to come from overseas trade.
He said that Britain must give businesses confidence to invest, and also work on removing government obstacles to growth and a "slow, oppressive planning regime".
He added that while the government was supporting scientific and technical research, and boosting the number of apprenticeships, "beyond that, the government has very limited scope to promote growth through fiscal stimulus".
Long-term focus
The business secretary also asked whether shareholders in one company should be consulted before their board buys another company - a reference to the fact that many Kraft shareholders did not want to buy Cadbury earlier this year.
"On takeovers, I have concerns that too many are driven by short-term financial incentives," he said.
Mr Cable launched a consultation, called "A Long-term Focus for Corporate Britain", as part of a review of corporate governance.
"[The consultation] should produce a rounded account of the issues that may be causing a dislocation between what is best for owners and what is best for managers," he said.
Mr Cable also tackled the issue of directors' remuneration, asking why pay packages have risen so sharply over the past 10 years, and whether greater transparency in pay would be beneficial.
He added that he would continue to keep an eye on the banks.
"No one listening to the Chancellor's statement last week will be under any doubt of the government's collective determination to ensure that banks act in the interests of the wider economy, and that, in the new year, they must not engage in another self-indulgent bonus round," he told the conference.
'Lost ground'
Following a survey of 121 bosses of the biggest UK firms and large overseas companies operating in Britain, the CBI said the UK needed to cut regulation, and reduce both business and personal taxation.
The survey, which was co-produced by accountancy group Deloitte, said the UK scored highly for its economic stability.
However, respondents said the US, Canada, China and India were now seen as more attractive countries in which to invest.
The CBI said that while the UK still performed favourably, it had "lost ground over the past 10 years".
Richard Lambert, CBI director general, said: "Having acted fast to tackle the deficit, the government must now focus on how to attract more investment to the UK, if we are to create new jobs and grow the economy."
It added that while the UK still performed strongly in areas such as good labour relations and flexible working practices, these issues were now seen as less important for firms making investment decisions.
Regarding sectors of the economy, the CBI said manufacturing companies were the least likely to invest in the UK, while financial firms and others in the service sector were more likely to view the UK in a favourable light.
John Connolly, chief executive and senior partner of Deloitte, said: "If the UK economy is to continue its recovery, then growth and jobs will have to come from the private sector.
"One of the great challenges for policymakers is to provide the right conditions for companies to grow."
Can the private sector provide the jobs needed for the UK's economic recovery? Are you a delegate at the CBI conference? Send us your comments and experiences using the form below.
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NEW YORK (Reuters) - Bailed-out insurer American International Group said on Monday Chief Executive Robert Benmosche has cancer and has an unclear prognosis, casting another shadow on the company as it undergoes a comprehensive restructuring.
AIG did not disclose what kind of cancer Benmosche, 66, has but said he is undergoing "aggressive chemotherapy."
Benmosche, in a statement, said he felt fine but that his long-term prognosis would not be clear until he had a couple more months of treatment. In a letter to AIG employees, Benmosche said he intended to maintain a normal schedule and to work until his intended retirement in 2012.
AIG watchers said the news was a clear negative.
The company's shares fell 32 cents to $40.80 in thin after-hours trading from a $41.10 close on the New York Stock Exchange.
"Investors should be worried about this. He's going to keep working while he's getting chemotherapy. Most people wouldn't find that very tenable," said Sean Egan, principal of Egan-Jones Ratings Co, which rates AIG's debt.
"Keeping him in place might be reasonable in the short-term, but I question if it's in the company's longer-term interests," Egan said.
Others said if Benmosche has to be replaced, it would be a less daunting task now than three or four months ago, given the progress he has achieved.
"At the end of day the CEO position has been a difficult one to fill at AIG, but what Benmosche has been able to do by hook or by crook will presumably make it a less difficult position to fill," said Aite Group analyst Clark Troy.
Benmosche has been an authoritative presence at AIG since becoming CEO in August 2009, getting much of the credit for a turnaround that included selling foreign life unit ALICO at an attractive price to MetLife and sorting out the mess surrounding the failed sale of Asian unit AIA.
In July, Benmosche won a boardroom battle with former chairman Harvey Golub over the failed AIA sale. Reports indicated Benmosche had threatened to resign if Golub was not replaced.
AIG said it was engaged in contingency planning in case Benmosche needed a substitute. Aite Group's Troy said any new CEO would likely have to come from within the organization, given the complexity of challenges AIG faces.
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Can the private sector provide the jobs needed for the UK's economic recovery? Are you a delegate at the CBI conference? Send us your comments and experiences using the form below.