Economy

Looming recession. Stagnant wages. Soaring prices. Higher unemployment. Falling property prices. The backdrop of gloom today and more gloom tomorrow was unremitting as chancellor Jeremy Hunt on Thursday laid out a series of well-trailed measures on tax rises and tight controls on spending. The Office for Budget Responsibility (OBR) released forecasts warning that real disposable incomes would drop by 7.1 per cent over the next two years, the biggest fall in living memory. “Virtually all of us can expect to be worse off,” Paul Johnson, director of the Institute for Fiscal Studies think-tank, said in the wake of the Autumn Statement. “We are in for a long, hard, unpleasant journey.”Readers at the very top end of the income scale, however, may regard the chancellor’s measures as less punishing than they might have been. His main revenue raiser came from “stealth taxes” — the effect of freezing allowances and thresholds, which pulls millions of taxpayers into higher tax bands as inflation leads to wage increases. “Super higher earners were warned that those with the broadest shoulders would pay the most,” says Tim Stovold, tax partner at accountancy firm Moore Kingston Smith. “That hasn’t happened. It’s a reasonably soft landing for them.” When it comes to the investment outlook, there may be brighter prospects in store for some unloved UK equities. As the country enters an era of painful fiscal retrenchment, FT Money assesses the impact of the chancellor’s measures for taxpayers, investors and retirement savers. The investment outlookOnly eight weeks ago then-chancellor Kwasi Kwarteng sent markets into panic mode with tax cuts in his “mini” Budget. Investors looking for reassurance in Hunt’s statement this week could take heart from a relatively muted market reaction. William Hobbs, chief investment officer at Barclays Wealth, said he was watching to see if investors in UK debt would put up with the chancellor delaying most of the fiscal tightening for several years. “The grown-up tone and the mostly orthodox thinking . . . seem to have been well received,” Hobbs says. As the relationship between markets and the government moves to a more stable footing following weeks of tumult, investors say there are some opportunities peeping through the gloomy economic outlook. “We have had a poor year, in particular [for] mid- and small-cap UK equities. But it’s hard to see at these valuations that stocks will sell down even further,” says Anna Macdonald, fund manager at Amati Global Investors. “We still see a lot of pressure and a lack of confidence in domestically exposed equities. But selectively they are looking like very good value now.” Stuart Clark, portfolio manager at Quilter, says his strategies have been light on UK equities, a position he’s now prepared to re-evaluate. “With the stability we see now, that can make the UK look slightly more attractive than it was before. That was something we were waiting for,” he says. Labour-intensive sectors will face pressure from the record increase Hunt announced to the national living wage, MacDonald says, but there will be some relief from business rates. Clark zeroes in on the chancellor’s decision to include even renewable energy producers in windfall taxes. “The move on the lower carbon producers I think is very interesting for the British economy,” he says. The government is still on a green push, but “it’s moving away from the carrot more to the stick,” he adds. Bonds could also present an opportunity after a dreadful year, particularly for UK gilts. Yields on UK 10-year debt have risen from around 1 per cent in January to 3 per cent today. Many investors might find that income stream tempting, but have been nervous about volatility in bond prices. Further turbulence now looks less likely. “The repricing of government bonds is proving an attractive opportunity for us,” says Clark. However, Hobbs says taking advantage of a more stable market to scoop up bargains in either UK stocks or bonds carries substantial risks. A higher-than-expected inflation rate could mean interest rates stay higher for longer than markets expect, knocking bond prices. UK companies that earn their revenues domestically are vulnerable to the bleak economic outlook and further weakness in sterling. Hobbs flagged the fall in real disposable income projected by the OBR. “If that really happens, you’re going to want to be quite wary. That is a monster fall,” he says. “It’s just [a question of] waiting until the markets are on top of the bad news to a greater extent.”Squeezing the middleThe main policy to “make those who have more, pay more” was a cut in the threshold at which the 45p income tax rate becomes payable from £150,000 to £125,140. This represents a flat tax increase of £1,243 for everyone earning over £150,000. In fact, after the reversal of an increase to national insurance this year, anyone earning over £180,000 will take home more in the next tax year than they will in the current one, while those earning £160,000 will take home less, according to Nimesh Shah, chief executive of tax adviser Blick Rothenberg. “The ‘squeezed middle’ were squeezed again by Jeremy Hunt,” he says. Those being dragged into the higher rate tax band for the first time will see the highest rate increases. Analysis by broker AJ Bell calculated that those currently earning £50,000 would over pay £6,288 more in tax owing to frozen thresholds between now and 2028 than they would have done had the tax allowances risen in line with inflation — a 14 per cent increase. Speculation that Hunt would raise capital gains tax (CGT) rates did not come to pass but cuts to the capital gains and dividend annual allowances came as a blow to business owners and entrepreneurs, as well as investors who rely on dividends outside tax wrappers and pensioners selling down assets. The CGT annual allowance will fall from £12,300 to £6,000 from next April, halving again to just £3,000 from April 2024. Higher rate taxpayers with a capital gains bill will pay an extra £1,860 on shares and £2,604 on taxable property in 2024 — no matter how big the gain. The dividend annual allowance falls from £2,000 to £1,000 next year, then to £500 from April 2024, translating in two years’ time to an extra tax burden of £590 per year for additional rate taxpayers earning over £2,000 in dividends. “This move will mean some company directors reassess whether there is a tax benefit to running their own business, which doesn’t exactly play into the government’s hands of boosting GDP and creating more homegrown businesses,” says Laura Suter, head of personal finance at broker AJ Bell. Middle-earning small business owners and the self-employed felt particularly stung by the chancellor’s cut to the dividend allowance. Andy Chamberlain, director of policy at the Association of Independent Professionals and the Self-Employed, said: “We’ve already seen the number of self-employed fall dramatically since the pandemic. The government seems intent on reducing that number further.”The freeze to the inheritance tax “nil-rate band” — which has not budged since 2009 — will also be extended from the 2025-26 tax year to 2027-28 — a move the Treasury estimates could raise half a billion pounds. IHT receipts have doubled in a decade, and are forecast to reach £6.7bn this tax year. Alex Davies, chief executive of brokerage Wealth Club says the announcement is “another kick in the teeth for those wanting to pass down their wealth to loved ones”. It estimates the freeze and inflation will leave IHT payers facing an average bill of £297,800 in 2025-26 and to £336,600 in 2027-28. Retirement saversFor pensioners, Hunt reinforced the Conservative commitment to the “triple lock” by confirming that the state and new pension will rise by 10.1 per cent next April — a record inflation uplift to these benefits. The full new state pension, introduced in 2016, will increase to more than £10,000 a year.But finance experts say millions of pensioners will be dragged into the tax net because of another measure in the statement: the freeze in the threshold at which income tax starts to be paid at £12,570 until at least April 2028.“There is a sting in the tail as there is potential for the state pension to exceed the frozen personal income tax threshold by 2028, potentially dragging many millions more pensioners into paying income tax,” says Andrew Tully, technical director with Canada Life, a pension provider. Stovold of Moore Kingston Smith describes the CGT and dividend allowance reductions as “most concerning” for pensioners on low incomes who rely on dividend payments and capital gains for income. “The government should possibly consider age-enhanced allowances for pensioners who are vulnerable,” he says. State pension income is taxable but usually paid without any tax being deducted. The amount of income tax a pensioner pays depends on total annual income from all sources, which could include state pension, personal pension, interest and any rental income.In spite of the relief offered to those on the state pension, there were concerns that future retirees would have to wait longer to receive it, as the welfare bill mounts.The current state pension age is 66 but it is scheduled to rise gradually to 67 between 2026 and 2028. On Thursday the government said it intended to publish the outcome of a review of the state pension age in early 2023. This could bring forward the timetable for increasing the state pension age to 68 — and potentially beyond.Reporting by Mary McDougall, Joshua Oliver, James Pickford, Josephine Cumbo and Chris Tighe More

One day before the Autumn Statement, official data showed UK inflation hit a 41-year high of 11.1 per cent. So it was no surprise that chancellor Jeremy Hunt said his principal objective was to help the Bank of England defeat domestic price rises — which are forecast to remain at 7.4 per cent next year.But this only serves to highlight the lack of inflationary uplifts to the tax-free allowances for savers and investors. The chancellor seems to think anyone with surplus savings is in the category he describes as having “the broadest shoulders” — justifying his cuts to the dividend and capital gains tax allowances. Does this set the tone for a further whittling down of our valuable allowances? I fear so.The standard pension lifetime allowance has been £1,073,100 since 2020 and remains frozen — penalising successful investment strategies as well as those who have been committed to contributions. Similarly, the pension annual allowance has been stuck at £40,000 since 2014, and the annual individual savings account allowance of £20,000 hasn’t risen since April 2017.If you didn’t get an inflationary pay rise, you’d protest. And it should be the same with the allowances provided to help you pay your way into retirement. So write to your MP.Meanwhile, if you didn’t get round to a spring or summer clean of your finances, then autumn can be a good time to take stock, mitigate the damage from icy tax grabs and stealth freezes, and consider how to prevent inflation from eroding your money.On the one hand, the tax situation is not as bad as might seem — the allowances remain generous and HMRC stats show they are infrequently used to the max. Plus, the chancellor caved in to pressure on the bedrock of retirement income: reinstating the state pension triple lock, meaning the benefit will rise by 10.1 per cent in April.But there are no guarantees that the triple lock will go untouched for a second year. Although the Bank of England has predicted inflation may drop to 7.9 per cent by the third quarter of next year, keeping the triple lock in place for 2024 will remain expensive. If inflation remains high, I can’t see how giving pensioners inflation-linked uplifts is sustainable when nurses and other public sector workers strike for the equivalent.And while the chancellor gives with one hand, he takes (some) away with the other. Freezing income tax thresholds at a time of soaring inflation is a stealthy way of raising more tax from all age groups.The combination of the state pension rising to £10,000, plus inflation-linked uplifts to workplace public and private sector pensions, means at least half a million more over-65s will have to pay income tax, according to LCP calculations.Meanwhile, there’s a government state pension age review coming in January 2023. Anyone under 50 should expect their state pension start date to be pushed to age 70 and, in the case of the under-45s, possibly age 75.That’s even more reason to invest now to plug the gap. And to use Isas, which not only shelter savings from dividend and capital gains tax but also won’t be subject to tax grabs in retirement.If you’re very well off or have received a windfall, remember to use your spouse’s allowances, too, and consider children’s Junior Isa allowances — set at £9,000, annually.Investors with taxable investments can use Bed and Isa facilities — to sell tax free and then reinvest via the tax shelter — to mitigate the cuts to the capital gains and dividend allowances. In addition, higher rate taxpayers can transfer taxable investments to family members in lower tax brackets.All those approaching retirement should consider maximising their pension contributions, too, as the upfront tax relief generates a return on the investment that can help beat inflation.Higher rate taxpayers still benefit from full upfront tax relief on pensions — so use it while it lasts, as a 30 per cent flat rate for all has been mooted as a way of treating lower earners more fairly.Also, ask for a pay rise — and remember that anything less than inflation will have a knock-on effect on your pension contributions, including those from your own personal income and from the government and your employer.High inflation means you can see the value of your cash savings erode, too — so make sure your deposits are working as hard as they can. Savings comparison website Moneyfacts.co.uk picks out the 18 Month Fixed Rate Deposit from Union Bank of India (UK) Ltd, paying 4.55 per cent, and the 120 Day Notice Account from Gatehouse Bank, paying 3 per cent. Another way to keep up with changing rates is to use a savings platform, such as Hargreaves Lansdown Active Savings.But despite the challenging time for markets, a new poll by Interactive Investor has found more than two-thirds (67 per cent) of investors believe now is a good time to invest.Hargreaves Lansdown says it has seen increased interest in resources and energy funds that benefit from rising commodity prices, and its top fund sector in the month prior to the Autumn Statement was North America.

Meanwhile, the FTSE 100 offers exposure to sectors that show resilience in tougher economic times, such as consumer staples, healthcare and utilities. Large UK companies in these industries look cheap compared with historic valuations and those in other developed markets. Many provide a high dividend yield, too.In theory, some assets offer built-in inflation protection — for example, infrastructure, property, and index-linked bonds. However, the risk is that any benefits from their inflation-linked income are undermined by the “derating” of their prices caused by higher interest rates.So, if you already have a well-structured investment portfolio diversified by sector, geography and asset classes, I’d ignore the market noise, keep calm and carry on.Focus on what you can control, such as the cost of what you pay for investing. Moving to cheaper funds and lower cost investment platforms can significantly boost returns when savings are compounded over several decades. It could be your most powerful weapon in the fight against inflation.But, if your investments do fall short, perhaps reconsider your plans to leave an inheritance. Many millennials would rather their parents focus on keeping cash reserves to fund a comfortable retirement and help with the cost of living, rather than passing too much down.Or think about downsizing. Halifax says moving to a home one bedroom smaller would, on average, raise £120,820. That’s a useful safety net if future tax policies bring more pain for your finances.Moira O’Neill is a freelance money and investment writer. Twitter: @MoiraONeill, Instagram @MoiraOnMoney, email: moira.o’[email protected] More

SAN JOSE, Calif. (Reuters) -A California judge sentenced Theranos founder Elizabeth Holmes to 11 years and three months in prison for defrauding investors in her now-defunct blood testing startup that was once valued at $9 billion.U.S. District Judge Edward Davila in San Jose, Calif., sentenced Holmes on three counts of investor fraud and one count of conspiracy. A jury convicted Holmes, 38, in January following a trial that spanned three months.Holmes, dressed in a dark blouse and black skirt, hugged her parents and her partner after the sentence was handed down.During the hearing, Holmes cried as she said she was “devastated” by her failures and would have done many things differently if she had the chance.”I have felt deep shame for what people went through because I failed them,” she said. Before handing down the sentence, Davila called the case “troubling on so many levels,” questioning what motivated Holmes, a “brilliant” entrepreneur, to misrepresent her company to investors. “This is a fraud case where an exciting venture went forward with great expectations only to be dashed by untruths, misrepresentations, plain hubris and lies,” he said. The judge set Holmes’ surrender date for April. Her lawyers are expected to ask the judge to allow her to remain free on bail during her appeal.Assistant U.S. Attorney Jeff Schenk told the judge before he handed down the sentence that a 15-year sentence would be “making a statement that the ends don’t justify the means.”Holmes’ attorney Kevin Downey sought home confinement for Holmes, saying leniency was justified because unlike someone who committed a “great crime” she was not motivated by greed.The federal probation office had recommended a 9-year prison sentence, according to court papers.Prosecutors and an attorney for Holmes declined to comment as they left court.Prosecutors said at trial that Holmes misrepresented Theranos’ technology and finances, including by claiming that its miniaturized blood testing machine was able to run an array of tests from a few drops of blood. The company secretly relied on conventional machines from other companies to run patients’ tests, prosecutors said.Holmes testified in her own defense, saying she believed her statements were accurate at the time.Though she was convicted on four counts, Holmes was acquitted on four other counts alleging she defrauded patients who paid for Theranos tests.Once valued at $9 billion, Theranos Inc promised to revolutionize how patients receive diagnoses by replacing traditional labs with small machines envisioned for use in homes, drugstores and even on the battlefield.Forbes dubbed Holmes the world’s youngest female self-made billionaire in 2014, when she was 30 and her stake in Theranos was worth $4.5 billion.But the startup collapsed after a series of articles in the Wall Street Journal in 2015 questioned its technology.Holmes is expected to challenge her sentence and Davila’s rulings upholding her convictions at the 9th U.S. Circuit Court of Appeals.Before handing down the sentence, Davila asked if any victims of Holmes’ fraud were in court. Alex Shultz, whose son Tyler Shultz worked at Theranos and whose father, former U.S. Secretary of State George Shultz, invested in the company, told the judge how a family member once heard Holmes describe her supposedly revolutionary technology.”What’s the hitch?'” the family member asked Holmes,according to Shultz.”There is no hitch,” Holmes responded. More

WASHINGTON (Reuters) -U.S. congressman Hakeem Jeffries on Friday formally launched a bid to become the Democratic leader in the House of Representatives, a day after Speaker Nancy Pelosi announced she was giving up her leadership role.If he wins the Nov. 30 House Democratic leadership election, Jeffries would become the first Black lawmaker to head a party caucus in Congress. Jeffries, at age 52 three decades younger than Pelosi, would embody not only the party’s diverse voter base but also a new generation of leadership in the House.Pelosi’s decision to step down after two decades leading the House Democratic caucus came a day after Republicans cemented a narrow majority in the chamber and prepared to name a speaker from their own party.If he gets the job, Jeffries would have to navigate not only the responsibilities of being the head of a minority party in the chamber – balancing when to cooperate with Republicans and when to defend President Joe Biden’s agenda – but also the delicate task of keeping his fellow Democrats on the same page. One of the trickiest challenges could be easing tensions between the party’s centrists and its restive left flank.The often-reserved Jeffries – known as “Kool Ha” by college fraternity brothers for his measured speaking style, according to the Almanac of American Politics – put on a more pugilistic display at a news conference this week. He lashed out at what he called “extreme MAGA Republicans” taking control of the House – a reference to Republican former President Donald Trump’s “Make America Great” slogan.Republicans will formally take control of the House in January after picking up enough seats in last week’s midterm elections to erase a narrow Democratic majority.Jeffries announced his bid in a letter released by his office, saying: “I write to humbly ask for your support for the position of House Democratic Leader as we once again prepare to meet the moment.” No challengers to Jeffries have yet emerged.Pelosi issued a statement in support of Jeffries as well as Representatives Katherine Clark and Pete Aguilar, who are seeking other Democratic leadership positions. Clark, a progressive, is running for the No. 2 leadership position. Aguilar, a centrist, was expected to seek the leadership post of chairman of the Democratic caucus, which Jeffries now holds.’A CONSENSUS BUILDER’Some fellow Democrats already have applauded Jeffries for reaching out to the various wings of the party.”He is going to be a consensus builder. He’s not in one camp or the other,” said California Democratic Representative Ro Khanna, a progressive. Khanna said in a telephone interview that Jeffries approached him several times to discuss tech issues. Khanna said the two have talked about cryptocurrency and an “internet bill of rights.”The expected new Democratic leadership team headed by Jeffries, Khanna said, will decentralize power in the caucus, giving voice to more lawmakers.”It will give us a chance for a Raskin, a Neguse, an AOC, Spanberger, Slotkin to really shine,” Khanna said of influential Democratic Representatives Jamie Raskin, Joe Neguse, Alexandria Ocasio-Cortez, Abigail Spanberger and Elissa Slotkin.Pelosi made history as the first woman to lead a party in either chamber of Congress and to serve as speaker. Becoming minority leader could set Jeffries on a path to become the first Black speaker – if the Democrats manage to regain a House majority.Jeffries, who has long worked to position himself for the top leadership post, was first elected to Congress in 2012, having previously served in the New York state legislature, where he worked on affordable housing issues and fought against some aggressive policing practices. In Congress, he served in 2020 as one of the House managers handling the prosecution of then-President Donald Trump in a Senate trial following the first of two impeachments.Jeffries led a bipartisan effort on criminal justice policy that led to the 2018 passage of a law restructuring sentencing procedures for certain drug offenses and increasing educational and vocational funding for prisoners to help reduce repeat-offender rates.If Jeffries wins, Democrats would be placing party power in Congress in the hands of New Yorkers. Senate Majority Leader Chuck Schumer represents the state and Jeffries represents a congressional district in New York City spanning parts of Brooklyn including the historically Black Bedford-Stuyvesant neighborhood. While he is a member of the Congressional Progressive Caucus – which includes many of the party’s lawmakers on the left – Jeffries at times has had strained relations with some progressives, uneasy over his ties to corporate America. Earlier in his career, he did work for corporate clients as a lawyer at a New York law firm.He won re-election in his House district last week with 72% of the vote.While Pelosi and the current No. 2 House Democrat Steny Hoyer are giving up their leadership posts, 82-year-old congressman James Clyburn said he would seek to remain in the House Democratic leadership. More

WASHINGTON (Reuters) – A White House official said Friday that “this administration believes every company – including social media companies – should take all necessary steps to protect the safety of Americans’ online data.””Twitter should speak to how they are ensuring that happens,” the official said. More

S&P in May upgraded its outlook to positive from stable, citing an improved fiscal trajectory.”Higher-than-expected government revenue has supported the fiscal position this year, but fiscal pressures remain,” the ratings agency said.In the country’s mid-term budget statement delivered in October, the National Treasury said South Africa’s budget deficit would shrink more quickly than before, with debt stabilising at a lower level.Although power and logistical bottlenecks continue to weigh on the South African economy, S&P expects that government measures to increase private sector activity and reform some key government-related enterprises could support stronger growth outcomes over the next two to three years.South Africa suffered a sharp economic contraction during the COVID-19 pandemic, but its recovery has been supported in the past two years by a commodities windfall that has boosted government revenue.On Friday, S&P also affirmed its “BB-/B” foreign currency as well as “BB/B” local currency ratings on South Africa, which has not been investment grade since 2020. More

BUFFALO, N.Y. (Reuters) -An early winter “lake effect” storm dumped 2 feet or more of snow on parts of western New York state on Friday, disrupting travel with bursts of icy powder blowing in from Lake Erie and Lake Ontario expected to pile up through the weekend.The squalls could persist through Sunday, creating sporadic blasts of intense snowfall along narrow bands that could amount to 4-1/2 feet (1.4 meters) of snow in some locations, according to National Weather Service forecasts.Accompanied by plunging temperatures, the region’s first major snowstorm of the season materialized on Thursday and gained momentum overnight into Friday, even though winter officially begins on Dec. 21.High winds and snow-draped tree limbs and power lines knocked out electricity to thousands of utility customers, while the storm also forced closures along the New York Thruway and flight cancellations at Buffalo Niagara International Airport.Even so, many western New Yorkers, accustomed to bouts of winter weather even more severe, seemed unfazed.A Twitter user going by the name of @BuffaloSnowKing posted a video of himself standing outside late on Thursday evening as snow blanketed his yard. “How can you not enjoy this weather?!” he tweeted.As of early Friday, road travel bans that had kept motorists off the streets overnight remained in effect for much of the central part of Erie County. But officials lifted road restrictions, at least temporarily, and instead issued travel advisories in the northern and southern parts of the county, including Buffalo, the state’s second-most populous city with some 278,000 residents.”It was a relatively quiet night for everybody,” including emergency response, Daniel Neaverth, commissioner of Erie County Department of Emergency Services, told reporters early on Friday morning as the snowfall eased.The lull may prove short-lived, forecasters said. At the rate of 1 to 3 inches per hour, another 2 feet of snow could fall on the area by Saturday, said Liz Jurkowski, a meteorologist with the National Weather Service (NWS) in Buffalo.Snowfalls of such proportions are not uncommon for western New York in November, when the relatively warm waters of the Great Lakes can mix with frigid air in the upper atmosphere dropping down from the Arctic, according to the weather service.Illustrating the highly localized nature of the lake-effect phenomenon, Orchard Park’s 36-inch accumulation as of 9 a.m. contrasted with the 1.6 inches that fell in Tonawanda, just 23 miles to the north, according to the weather service. Two other Erie County towns, Hamburg and Wales, measured nearly 34 inches and 26 inches, respectively, while Buffalo reported almost 14 inches Friday morning.The weather service cited one report of 4 feet measured by a “trained spotter” near the lakeshore village of Bladsell, south of Buffalo.Nearly 4,000 customers were without power in the Buffalo area as of Friday afternoon, according to Poweroutage.us. Neaverth said he expected service in Erie County to be restored quickly.Neaverth noted “a few minor accidents” and some vehicles stuck on roads overnight.Erie County closed its offices on Friday, though essential staffers were to report to work. The Buffalo Public Schools district, the state’s second-largest serving 32,000 students, canceled all classes and closed offices on Friday.Jurkowski of the NWS cited multiple reports of “thunder snow” as the sky rumbled and flashed with lightning.All but five of almost 80 flights scheduled to depart from Buffalo on Friday were canceled, the airport’s aviation director Lee Weitz said.The prospect of up to 4-1/2 feet of powder on the ground by the close of the weekend prompted the National Football League to move the Buffalo Bills’ Sunday home game against the Cleveland Browns to Detroit.The storm developed as temperatures for the region, andmuch of the northern United States, plunged 10 to 20 degreesFahrenheit below average for this time of year, said Rich Otto, a Storm Prediction Center meteorologist in College Park, Maryland. More

NEW YORK (Reuters) -The longtime chief financial officer at the Trump Organization told jurors on Friday that Donald Trump’s namesake company raised his salary after his sons, who ran the company in 2017, were aware that he failed to properly report income and expenses.In his third and final day of testimony at the Trump Organization’s tax fraud trial, Allen Weisselberg said the real estate company cleaned up its tax practices in anticipation of additional scrutiny after Trump entered the White House and left his sons, Donald Trump Jr. and Eric Trump, in control.Weisselberg testified that during the cleanup, Trump’s sons knew the company paid executives’ personal expenses that were not reported as income, and gave them bonuses as if they were independent contractors.He told Susan Hoffinger, a prosecutor with the Manhattan district attorney’s office, that the company had not demoted or disciplined him over how the payments were recorded.”Were you in fact given a raise … that totaled approximately $200,000?” Hoffinger asked. “Correct,” Weisselberg said. He said he asked for a raise in 2019 to make up for the loss of his pretax expenses. Weisselberg has admitted to helping engineer a 15-year tax fraud at his longtime employer, and to personally evading taxes on $1.76 million of income.Now on paid leave, he pleaded guilty in August as part of an agreement requiring he testify for the prosecution and serve five months in jail.Neither Trump nor his sons have been accused of wrongdoing. The company has pleaded not guilty. Weisselberg said the company also did not fire or otherwise discipline two other executives who had engaged in similar practices.He said he had little interaction with Trump about the company after Trump became president.But he said Trump was aware the company had paid rent on Weisselberg’s luxury Manhattan apartment for years, and signed the lease in 2005.He also said Trump knew the company had leased Mercedes-Benz cars for him, his wife and another executive, and that Trump signed Christmas bonus checks that did not deduct employee taxes.Weisselberg, who has worked for the Trump family for nearly 50 years, said his 2022 salary and bonus exceeds $1 million. He hopes to get another $500,000 bonus in January. Friday’s questioning also addressed Weisselberg’s motivations in providing testimony.He said he met separately with prosecutors and defense lawyers to prepare, including a meeting with Trump Organization attorney Alan Futerfas on Wednesday after his testimony began.Weisselberg told Hoffinger he did not recall whether Futerfas seemed unhappy with his testimony.Futerfas later suggested that Weisselberg might face more pressure from prosecutors because of his plea agreement.”So in your mind you’ve got to make these people happy, correct?” Futerfas asked Weisselberg.”I have to tell the truth,” Weisselberg responded.The trial will resume on Monday. More