ECONOMIC GROWTH looks certain to be revised up following an unexpected rebound in manufacturing and exports, according to official figures published yesterday. “These are very complex rules, but staff are paying tax on their tips when they shouldn’t have to.” he said.Alain Lhermitte, who owns the family-run Mon Plaisir, which is back in business, said yesterday he would not try to resettle with the Revenue.”I didn’t do anything wrong. The changes will allow a number of businesses to reclaim tax that has been wrongly charged. Tens of millions of pounds are at stake in unsettled claims.”Bob Cotton, of the BHA, said the changes would make a significant difference to waiting staff pay packets, as well as business profits. One victim was Mon Plaisir, London’s oldest French restaurant, which went into liquidation after receiving a pounds 500,000 bill for unpaid tax.John Whiting, of PwC, said: “The Revenue has now agreed that exemption from national insurance isn’t lost in a number of cases, including if management keeps some of the money to cover costs. THE RESTAURANT industry claims it has won a multimillion-pound victory against the Inland Revenue over tax demands on tips. Tax experts believe the Revenue, which has been investigating tipping systems in more than 400 restaurants, will have to reimburse some businesses and drop claims amounting to more than pounds 20m after it agreed to changes in its guidelines as to how tips are taxed.
After negotiations with PricewaterhouseCoopers (PwC) and the British Hospitality Association (BHA), the Revenue has clarified its rules on tips left by customers that are distributed to staff.

Previously they would have had to pay national insurance.The new guidelines on the way tipping is to be taxed will be published today.The Revenue launched a crackdown, known as Operation Gourmet, on the industry 18 months ago, and some businesses have been landed with hefty bills.The Conran Restaurant Group, for example, is understood to have an outstanding claim against it of more than pounds 1m. Restaurant owners can now, for example, deduct credit card transaction charges from the pooled tips and still escape paying national insurance. The deal will be financed by Creston’s existing pounds 5.5m of cash reserves plus a placing and open offer for new shares in Creston worth pounds 9.5m to fund the initial consideration.Creston was a former cash shell, listed on the stock market, which Mr Elgie acquired to build a new media services group in January 2001. First, it allowed a sharp – though as it turned out, temporary – fall in sterling that gave a direct boost to the economy without generating any significant inflation. FIRST CHOICE Airways, Britain’s second-biggest charter airline, delivered a snub to Rolls-Royce yesterday by choosing the US engine maker General Electric to power its new fleet of Boeing 787 Dreamliner jets.

The airline, which is owned by the tour operator First Choice Holidays, said it had selected the American-made GEnx engine in preference to Rolls’ Trent 1000 for its fleet of six 787 Dreamliners.
This makes First Choice the launch customer for the new General Electric engine. The airline’s managing director, Chris Browne, said the GE engine had been selected because of its strong technical reliability, more efficient fuel burn and reduced level of emissions.Of the 14 airlines which have so far ordered the new Boeing jet, only three have announced an engine supplier. The first two customers for the 787, Japan’s All Nippon Airways and Air New Zealand, who between them have ordered 52 aircraft, have chosen the Rolls engine.A spokeswoman for Rolls shrugged off the disappointment of losing the First Choice order by commenting: “We still have more than 90 per cent of the market at this stage.”The 250-seater 787 jet is being designed so that the Rolls and GE engines are interchangeable. The two engines will have a common physical mounting on the wing and common software links to the rest of the aircraft, meaning that airlines can replace one make with another very easily.This is designed to appeal to leasing companies because their airline customers very often have a preferred engine supplier depending on whose engines power the rest of the fleet..

The deal will land Greg Delaney and Mark Lund, the chairman and chief executive of DLKW, pounds 2m in cash each plus up to pounds 900,000 each in Creston shares.
Of the 33 shareholders in DLKW, another four will get pounds 1m each in cash plus up to pounds 430,000 each in shares. It lowered its interest charges to existing customers by 0.4 percentage points to 6.35 per cent to prevent them defecting to competitors who offer lower introductory rates, such as Hbos.Britannia, based in Leek, Staffordshire, has 2.2 million customer members, making it Britain’s second-biggest building society after Nationwide.. Also supporting WPP was Credit Suisse First Boston, which was heard telling investors that upgrades to forecasts for the advertising giant are likely in the coming months. WPP closed up 9.5p at 592p.
Outside the media sector, GlaxoSmithKline jumped 22p to 1,232p before today’s fourth-quarter results from the pharmaceuticals group. As a result, it has a low stock market profile, although the retirement of Richard Hanson as chairman last year nudged corporate governance in the right direction. Not that the company’s performance has been at all dissatisfactory. It is an old-school mix of brewing, pub and restaurant assets, including more than 250 pubs concentrated in Nottinghamshire, Derbyshire and Yorkshire.