this is business live from bbc news, with aaron heslehurst and sally bundock. tax wars — can brexit britain and trump's united states beat the likes of ireland at their own game and lure back the multinationals and their billions? live from london, that's our top story on thursday 26th january. can the president force through the tax cuts he says will help boost and fuel the world's biggest economy? another big fine — royal bank of scotland says its mis—selling in america's sub—prime crisis will now cost more than $8 billion. it is the trump pump, the dow on wall street passing through the 20,000 mark on its first time in

history. we'll bring you the latest on the markets. and we'll be getting the inside track on life in the fast lane with the boss of london's city airport. just how do you grow a business that's hemmed in on all sides? scientists say smart devices or is good at doctors as spotting skin cancer. what would you like your phone to warn you about? just use the hashtag bbcbizlive. welcome to the programme. we're talking about corporate tax cuts. it's a central part of president trump's strategy to boost the us economy, and is on the agenda today at the republican party's annual retreat in philadelphia. president trump will be there to give an address, as will british prime minister theresa may — a first for a foreign leader. before winning the election, mr trump promised he'd

cut the us corporate tax rate from 35% to around 15% to try and keep more us business onshore. he's targeting the billions that us multinationals — like starbucks, google and microsoft — make overseas. mr trump says he'll allow them to repatriate those profits at a 10% tax rate. but britain's prime minister theresa may has pledged to deliver the "lowest corporation rate in the g20," as the uk tries to make itself attractive to big companies once it leaves the european union. the uk rate is currently at 20%. and next door is ireland, which is in the european union and has successfully attracted multinationals like apple, intel and pfizer. it has corporation tax ofjust i2.5%. did demystify all of this and talk

through the issues i'm joined by a guest. john cullinane is tax policy director at the uk's chartered institute of taxation. aaron outlining where we are at at the moment. interesting what donald trump has promised. the question is, can he deliver on those promises? it is included in the us, isn't it? can he deliver on those promises? it is included in the us, isn't mm is, because the government is not all powerful, having a majority in parliament. both houses of congress have two agree. obviously they are all now republican, but in the american system they still have very different ideas and proposals as to how to go about these things. that the key difference. in the uk we have a budget, they announced tax changes that can come into affect almost immediately if not the next day. in the us, it's so difficult to change the tax laws. theyjust getting to the round the edges. there hasn't ever been a real reform of the. that's right. 35% is there hasn't ever been a real reform of the. that's right. 3596 is quite

high on wild white terms now. most countries have a lower tax rate. —— oi’ countries have a lower tax rate. —— or worldwide terms. they change the rules, the uk is pretty much taking what it was before in cash terms and it is taking vastly more than it used to take in the 1970s with a tax rate of 52%, because as it has driven down the rate it has broadened the base. one of the big issues now, when they reduce the tax on the us, will they broaden the base or will they just on the us, will they broaden the base or will theyjust use it to pump money in? that is partly the difference between congress and president trump. john, we constantly hear that if president trump is successful and get that tax rate down to around 15% mark, that's a lwa ys down to around 15% mark, that's always good news for big corporations. but i'm wondering about, in the us you can imagine there is millions of them, millions of small to medium—size businesses, we know that as the bloodline of any economy, does that also benefit the smaller guys? well, it can do. in

the us, a lot of small businesses, evenif the us, a lot of small businesses, even if they are incorporated, they look through it for tax purposes, they are still packs against the individual and the individuals have higher rates. in the uk it is becoming a problem that does the corporation tax rate is going down, any small business is tempted to incorporate that it otherwise wouldn't and pay the lower rates. on an international level, organisations like the oecd and others are trying to come up with an international tax system to make it simpler and also to avoid loopholes and tax evasion. if donald trump ploughs ahead with his plans, that will make it more, located, won't it? if donald trump's plans go through, ironically it will be a very low rate. the uk would arguably already be undercutting it because we are going to rate of i7%. his of 1596 we are going to rate of i7%. his of 15% to have the white and state taxes, when you add on those they would be about 20%. we would be undercutting donald trump and his tax system would not be recognisably like ours or the rest of the world.

ironically it is the republican leadership in congress that want to change the nature of the tax system to make it a hybrid between corporation tax and vat, that would make it a very different system to other countries, opening up the polls and double tax and so on. it's very complicated and the devil is in the detail —— opening up loopholes. the other big story that is just around, and news coming out about it this morning. britain's royal bank of scotland says its set aside another further $3.8 billion to cover fines in the united states. it's all linked to the mis—selling of financial products linked to risky mortgages in the build up to the 2008 financial crisis. simonjack is our business editor and he's been following the story. simon, you were digging out this detail late yesterday, what can you tell us? this is another big financial body blow for rbs. they have put in nearly $4 billion to one side. this isjust into a kitty they are putting together to have a

monsterfind are putting together to have a monster find they are expecting for their role in the sub—prime crisis. the kitty is that $9 billion at the moment. they are saying this is not a settlement and it is not final, because it's very likely they will have to put more money in this kitty next year. now, fine could be anywhere in the region of io— next year. now, fine could be anywhere in the region of 10— $20 billion, wejust don't anywhere in the region of 10— $20 billion, we just don't know yet. what it means that this charge they are taking today will guarantee another losing year for rbs. that will be the ninth year in a row that they have lost money. this is the bank that the uk public owns 72%. this is another big body blow. is it yet? no, it's not. management hope this is one step closer to the end ofa this is one step closer to the end of a very dark and very long tunnel. but i think we've got some way to go yet. thanks, simon. more detail on that, website as well. more stories making headlines all around the world... the broadcaster sky has reported a 9% fall in profits,

because of the rights of premier league football matches. they reported a 9% fall in operating profits to just a pinch under $18 million. rupert murdoch's company offered to buy up the remaining 61% offered to buy up the remaining 61% of the business. facebook‘s push into virtual reality has a new boss. hugo barra's appointment was announced with this picture on twitter. he'll lead the team which includes the oculus unit which mark zuckerburg's company bought for $2bn some three years ago. barra has formerly worked at google and chinese phone maker xiaomi. hejust left, i think, hejust left, ithink, didn't hejust left, i think, didn't he? that was the news story. that is for a quick. —— very quick. shares of mattel — the largest us toymaker — slumped around 9% after its sales over the holiday period fell well short of analysts‘ estimates. mattel — whose brands include barbie dolls and fisher price toys — lost the contract to make disney princess figures to rival hasbro. meanwhile, the wider toy industry

grew by some 5% in 2016, led by hasbro's star wars toys franchise. it's all about linking it up, isn't it, the tory with the movie franchise. big bucks. —— that we eat. asian markets are keeping the momentum going after yesterday's record breaking session on the dowjones — hitting 20,000 for the first time in history. closing above it for the first time in history. history wise, in years... 131 years! leisha chi is in singapore. at the moment, the asian markets are just riding that optimistic wave coming from wall street? absolutely. and i love some of the headlines that we're seeing about it. the ft says that the stocks are basking in the glow of the doubt going above 20,000. -- the the glow of the doubt going above 20,000. —— the dowjones. according

to bloomberg data, we have seen asian stocks rise the highest level since 2015. we have seen a very solid earnings season on wall street. good numbers from companies like boeing. of course as you mentioned, the donald trump effect. some people call it the trump train. we have seen stocks rising since november on optimism that his economic plans are going to be used. —— are going to boost stocks. asian stocks are mostly higher today. australia and india are closed. we will talk to you soon, thank you. let me show you those numbers. the wow on the dow from that trump pump rippling around the world. stocks in asia hit a 3.5—month high. traders in the region telling us today's excitement notjust from the hoorah on wall street, but also people being positive

about japanese companies. europe — following suit. you can see the green lines. not much more to say really except how long can the trump pump last. talking of the us — let's find out what's in store today. it's a big day, and here she is — here's samira. more companies will be reporting earnings thursday, including google's parent company, alphabet. now, google has been focusing on improving search advertising. so things like expanded text ads and little adjustments to its ad bidding process. microsoft will also be reporting earnings. and it seems cloud computing will continue to be a big moneymaker. especially as more people move toward cloud services. analysts will be asking questions about linkedin‘s integration into microsoft. that $26 billion deal to purchase the professional network was completed last month. and finally, the world's largest coffee chain, starbucks, will be reporting "perky" earnings.

cafes continue to drive sales, especially in its biggest market, right here in the united states. that's samira khaleghi who has had a really busy couple of days. haven't we all?! ok, ok, you are as busy as she, it out the! joining us is mike amey is managing director and portfolio manager at the investment management firm pimco. nice to see you, mike. let's get your take on the 20,000 moment, were your take on the 20,000 moment, were you p°ppin9 your take on the 20,000 moment, were you popping the champagne or was it just one of those things? it was a celebratory cup of coffee, to be honest. where you were expecting it? we had a couple of cracks at it, at some point it was going to happen. the two questions as to why we had such a big rally and how sustainable it is. i think, as you were talking

about earlier, you know, i think tax is broadly the main reason. what you have done, if you cut corporation tax from 35 to 15, then corporate earnings goes up. so you have got this... it is going to get better as you get more of the money?“ this... it is going to get better as you get more of the money? if they get more of the money they should pay more for the stock. they are buying on the room and they can sell on the news, possibly? that's what we are a bit more worried about. you have had this big move up in markets and tax, and of course they are going to be the stimulus package through. and the markets continue to focus on that. yesterday was a classic example. you have the tweet about building the wall, and the stock it's a new high. the markets get are looking for the good news. at some point you have got to recognise we are going to get a bubble. but i think it would be reasonable to be a bit more cautious, given the size of the movement, 10% last year. cautious, given the size of the movement, 1096 last year. momentum at

the moment, maybe going forward just watch for a bit of... there could be some profit—taking as well, right? don't get too carried away, we've had a decent run. captain cautious! i like it! had a decent run. captain cautious! i like it! might had a decent run. captain cautious! i like it! might you are coming back to ta ke i like it! might you are coming back to take us through some of the papers. we'll see you shortly. you're with business live from bbc news. we arejust churning we are just churning out the cars in the uk! the number of cars made in the uk reached a 17—year high last year, according to the industry's trade body. about 1.7 million cars rolled off production lines in 2016, a rise of 8.5% on the year before. theo leggett has been looking at the numbers. he is our internal motorhead, a petrol head! is he a petrol head? he loves it! before i get in trouble,

let me move on! sio, we do well. when you're doing well in the uk making cars, a lot of them, 50 cents, they don't stay here in the uk, we ship them out, don't we? we ship out about eight out of ten of all cars made here. if those 1.7 million cars, more than 1.3 million go to 160 countries around the world. most of them go to the european union. more than half of them go to the european union. this isa them go to the european union. this is a very successful industry in britain. part of the reason is that we specialise in hiring cars. and we have a very efficient manufacturing process for those cars —— hi end cars. this is not entirely a positive story. the society of motor manufacturers and radar putting the story out today, they are pointing out that investment in cars, new production lines and so on, went down to £1.7 billion last year. they

say that this high level of production, 17 year high level of production, 17 year high level of production and record exports, is due to decisions that were taken a few years ago. it's very emphatic that this is not any sort of a brexit bounce. and they are making the point here that what they want to see is the government having a fairly soft attitude towards its negotiations with the eu, making sure that the car industry at least has some kind of access to the eu's single market and that tariffs are not paid either on cars that we export of the european union or the parts that they are made of, a lot of which come the other way, because it says that if that happens it could be severely damaging for what is at the moment a rather successful industry. what do you drive? i drive a 1972 nanograms. from the great age of motoring. wow! you're watching business live.

our top story: as us republican party leaders lay out plans for tax cuts, will the big multinationals bring their profits back on shore, or can brexit britain win them over? a quick look at how markets are faring... everything in green again, coming from the big jump, over 20,000 for the first time in history, the dow jones. and that ripple effect circulating around the world. let's get the inside track on the airport at the heart of canary wharf which plays a vital role in bringing business leaders to and from the city of london. this year london city airport is marking it's 30th anniversary. it currently handles 4.5m passengers a year flying to 48 destinations. 71% of the flights link to a european union destination — something which may change once

the uk leaves the eu as with heathrow, it's bigger rival on the other side of london, city airport is looking to expand with more room for aircraft and a bigger terminal building. we have declan collier with us. we just talked about the fact that you are planning to expand, but how do you do that given where you are? you are completely surrounded, so you can't add runways or anything of that nature. we have just received planning permission for doing that and we are about to spend £350 million... a runway or a taxiway? we are building a parallel taxiway, make the runway more efficient in getting aircraft up and down. we are

building more and bigger parking stands to take the next generation of jets. we were talking about the number of destinations. the people around the world watching, you have around the world watching, you have a limited size of runway because it is surrounded by skyscrapers, so you can only use a certain size of aircraft. 95% of your destinations... when brexit came along, did you hold your breath? once the uk does leave, and if there are travel restrictions or you need visas and passports, could that impact you, the airport, people travelling? i don't think so. look, we say we are the only london airport actually in london. we are three miles from canary wharf, six miles from the city of london. we

can and will develop, and you are right — we are focused today on europe. 95% of our destinations are into europe. with this development plan, we get the new generation of aircraft coming in with longer range, $0 aircraft coming in with longer range, so we aircraft coming in with longer range, so we will open up destinations beyond europe, to the middle east and the gulf, into india, africa and hopefully expanding the destinations in america. how soon? if you look at heathrow and what will happen now, the go—ahead there will take at least till 2030 before you see anything happening with increased capacity. we can increase our capacity. we can increase our capacity in the next two, three yea rs. capacity in the next two, three years. what might you are irish. i wa nt to years. what might you are irish. i want to know — what is it with the irish and aviation? willie walsh, michael o'leary, the boss of the biggest airline in the world in

terms of bums on seats. is it in your blood? i think we woke up one day and realised we are a small island off another island off the shores of europe and the only way we can get around is to fly. we have been doing it for a long time. the invention of irish coffee was at shannon airport in the 1940s. we had the growth of duty—free coming out of the same place. and then in aircraft leasing, ireland is the home for the vast bulk of the war‘s aviation fleets because of the financing. it must be in the blood. must be! thank you for coming in. alcoholic drinks, talking of the irish!

— giant diageo has just released results for the second half of last year. the maker of smirnoff vodka, johnnie walker whisky and guinness stout says net sales were up more than 14 per cent, and operating profit up some 28 per cent. the company says its spirits business in the us is doing much better, and in particular its scotch whiskey brands. the chief executive of diageo, ivan menezes, spoke to us earlier. our performance across the us, latin america, europe, africa and asia was strong. all our businesses were in growth. and our categories and brands performed well. johnnie walker, our biggest brand, was up 6%. our whisky brands in north america, like crown royal and bullet, were up double—digit. the business is healthy, and it's a function of the strategy we been implementing in the last few years is really paying off. people around the world are drinking better, and diageo does better when that happens, because our brand of premium, and we benefit from the trade up that happens when people drink better.

i spoke to ivan minev is earlier. he is on our website. —— menezes. i am wondering what he is drinking there. martini. i should have asked what his favourite tipple is. i like beer and wine. i like champagne. iaman i like champagne. i am an aussie but i am not a big beer drinker. shall we start on the newspapers. our viewers have sent us tweets about the story in the times about the smartphone. doctors are saying it is as good if not better at

detecting skin cancer than perhaps going to your gp. amazing, isn't it? as we were saying earlier, one does not think about detection of cancer with smartphones. the clear thing is the computing power of smartphones is becoming phenomenal, and the number of things you can do is growing ever higher. and the demand for that kind of thing. when it comes to applications and wearable technology, a lot of it is to do with health, isn't it? making us healthier or figuring out what is wrong, that sort of stuff. can you go over your body with it? one in three people in australia get melanoma. let's hear what you had to say about this. one viewer says colon i would like

my phone to tell me if i am getting too stressed and to calm me down. collea g u es too stressed and to calm me down. colleagues can do that! we have had some ceos start—ups who are coming up with wearable technology. we will cover that. we have got twice the supply is compared to what we will use in the next 40 years, so the price shouldn't go up much. the price of $100 a barrel that we saw in 2014 will not come back? no. it will stay around the level it is at now. spot on, mate. thanks forjoining us. wrap it up, sal. goodbye for now. cold is the theme through the

day—to—day. particularly so when you factor in the wind, which is quite a bitter wind. that is coming in from a cold near continent. the cold across europe recently has been well documented. at least that is helping shift the fog problems at low levels, but it is dragging in fairly low—level cloud. we should not see visibility problems at lower levels through this morning. in scotland, some bright sunshine early on. fairly leaden skies across the southeast this morning, and the temperature around freezing orjust below. in the south—west, the winds are stronger. the cloud may produce the odd spot of drizzle or the odd fla ke the odd spot of drizzle or the odd flake of snow. most places will be fine. in northern scotland, that is

the place for some sunshine this morning. not quite so cold here, but quite windy. a lot of cloud across many areas through the morning. in the afternoon, we will begin to see the afternoon, we will begin to see the cloud break in the southernmost counties of england. some sunshine here, and maybe the western side of wales beginning to brighten up. temperatures are around 0— three celsius. particularly cold across northern and eastern areas. weather fronts are trying to push in. a lot of isobars on the chart. wind is coming from the south. still, a bit ofa coming from the south. still, a bit of a chill in the airfor coming from the south. still, a bit of a chill in the air for many. coming from the south. still, a bit of a chill in the airfor many. rain pushes in from the west, bringing higher temperatures. temperatures should reach eight celsius in belfast, 10 celsius in plymouth. chile towards the north—east, but it will be drier here. saturday, starts

of wet and windy. another spell of rain to come on saturday night into sunday, particularly for england and wales. sunday looks wet across the southern half of the uk. at the moment, it looks like wales, central and southern england could be wet. drierfurther north. hello, it's 9am, i'm victoria derbyshire, welcome to the programme. as donald trump says he believes that torture can work to get information out of terrorism suspects, we'll be asking what impact his words will have across the world. we'll be speaking exclusively to raffaele sollecito, who, together with amanda knox, was wrongly imprisoned for the murder of british student meredith kercher. and, the last survivor of the dambusters raid on germany in 1943 has never received a knighthood. tv presenter and raf ambassador carol vorderman is leading a petition to try to change that. we'll be talking to her. about british veteran johnny

johnson. hello. welcome to the programme, we're live until 11am this morning.