Brexit and stamp duty SIs laid

SIs laid in the last two weeks

Taxes (Amendments) (EU Exit) (No. 2) Regulations 2019

Procedure - Made negative. Made – 4 April 2018. Laid - 8 April 2019. Objection period ends – 27 May 2019. Length – 8 pages. Applicability – UK-wide

Purpose of the instrument (from government explanatory memorandum) - This instrument will make changes to keep tax law working in the same way as it does now if the UK leaves the EU without a negotiated deal. Where changes have been made to remedy deficiencies in retained EU law on intellectual property rights, international accounting standards and financial services that have consequences for tax law, this instrument makes changes to the relevant provisions of tax law.

Matters of special interest to the Select Committee on Statutory Instruments (from government explanatory memorandum) - According to the definition of “exit day” in the Interpretation Act 1978 on the day this instrument is made (at the time, this was 12 April), the instrument will be laid before the House of Commons less than 21 days before it comes into force. (The EM goes on to explain why this is the case.) It concludes: Stakeholders should not be disadvantaged by the shorter period of time between the instrument being laid and coming into effect because the amendments maintain the effect of legislation so there are no practical changes.

In summary – Another ‘no deal’ preparatory SI which will probably not ever come into force

Stamp Duty (Method of Denoting Duty) Regulations 2019

Procedure - Made negative. Made – 5 April 2019. Laid - 1 April 2019. Objection period ends – 20 May 2019. Length – 4 pages. Applicability – UK-wide

Purpose of the instrument (from government explanatory memorandum (edited)) - Stamp Duty is charged on instruments transferring shares or chargeable securities, on the impression of a physical stamp on the document(s) in question. The stamped documents can then be used to verify title to the shares or securities, in the first instance by company registrars. This instrument will extend the existing definitions used for stamping of documents and the way in which stamping may be done in order to provide flexibility for the use of alternative, replacement stamping mechanisms or machines.

In summary – Seems to be a technical update of definitions in this area without any substantive effect on tax policy

SI scrutiny over the last two weeks

Select Committee on Statutory Instruments

Report published 5 April 2019 covering decisions taken at a meeting 3 April 2019

The role of the SCSI, whose membership is drawn from the House of Commons, is to assess the technical qualities of each instrument that falls within its remit and to decide whether to draw the special attention of the House to any instrument on grounds including retrospectivity, unjustifiable delay, defective drafting and lack of clarity.

No SIs were reported at his meeting. 16 tax-related instruments were given the committee’s technical ‘OK’ -

Instruments requiring affirmative approval

S.I. 2019/397 Finance Act 2011, Schedule 23 (Data-gathering Powers) (Amendment) (EU Exit) Regulations 2019

S.I. 2019/404 Value Added Tax (Place of Supply of Services) (Supplies of Electronic, Telecommunication and Broadcasting Services) (Amendment and Revocation) (EU Exit) Order 2019

Instruments subject to annulment

S.I. 2019/358 Income Tax (Approved Expenses) (Amendment) Regulations 2019
S.I. 2019/360 Delivery of Tax Information through Software (Ancillary Metadata) Regulations 2019
S.I. 2019/382 Individual Savings Account (Amendment) Regulations 2019
S.I. 2019/384 Income Tax (Construction Industry Scheme) (Amendment) and the Corporation Tax (Security for Payments) Regulations 2019
S.I. 2019/385 Customs (Crown Dependencies Customs Union) (EU Exit) Regulations 2019
S.I. 2019/398 Tonnage Tax (Prescribed and Specified Matters) Regulations 2019
S.I. 2019/402 Crown Commercial Service Trading Fund Order 2019
S.I. 2019/408 Value Added Tax (Input Tax) (Specified Supplies) (EU Exit) (No. 2) Regulations 2019
S.I. 2019/449 Trade Remedies (Increase in Imports Causing Serious Injury to UK Producers) (EU Exit) Regulations 2019
S.I. 2019/450 Trade Remedies (Dumping and Subsidisation) (EU Exit) Regulations 2019
S.I. 2019/487 Customs (Managed Transition Procedure) (EU Exit) Regulations 2019
S.I. 2019/499 Capital Allowances (Environmentally Beneficial Plant and Machinery) (Amendment) Order 2019
S.I. 2019/501 Capital Allowances (Energy-saving Plant and Machinery) (Amendment) Order 2019
S.I. 2019/515 Stamp Duty and Stamp Duty Reserve Tax (Amendment) (EU Exit) Regulations 2019

Joint Committee on Statutory Instruments

The JCSI carries out the same role as the SCSI (see above) but includes both MPs and Peers and looks at SIs which need to be considered by both Houses of Parliament (ie not generally including tax SIs).

Report published 5 April 2019 covering decisions taken at a meeting 3 April 2019

No SIs were reported at his meeting. The following tax-related instruments were given the committee’s technical ‘OK’ –

Instrument not subject to Parliamentary proceedings not laid before Parliament S.I. 2019/540 Taxation of Chargeable Gains (Gilt-edged Securities) Order 2019

By George Crozier, Head of External Relations.