Finance Bill clears its Commons stages

17 Aug 2018

The first Finance Bill of 2017, much reduced, cleared its Commons stages in a little over two and a half hours this afternoon.

There follows a brief outline of the proceedings. A more thorough report will appear in this blog in the next day or two.

In the notes below underlined clauses and schedules indicate those removed from the Bill. These are as per the table here. All government amendments were passed. No opposition amendments were passed, Nothing was pushed to a vote (ie a division of the committee or the House). The clauses, schedules and amendments are listed in the groups they were debated in, not the order they were voted on.

Finance Bill committee stage ‚ Tue 25 April

1.03pm Group 1 - Income tax, corporation tax, chargeable gains and provisions relating to more than one tax

Clause 1 stand part + Clauses 2 to 4 stand part + Clause 5 stand part + Clause 6 stand part + Clause 16 stand part + Clauses 17 and 18 stand part + Clauses 19 and 20 stand part + Clause 21 stand part + Clauses 22 to 44 stand part + Clauses 45 to 47 stand part + Clauses 52 to 56 stand part + Gov 13 to Gov 29 + Schedule 3 stand part + Gov 30 to Gov 56 + Schedule 4 stand part + Schedules 5 and 6 stand part + Schedule 7 stand part + Schedules 8 to 15 stand part

The Financial Secretary (FST) indicated that the proposals to remove a majority of the Bill did not indicate policy change. Govt will legislate at earliest opportunity at start of new parliament. In particular Govt committed to digital future for tax system. Need for House to consider properly such measures. Then introduced first set of clauses.

Among other speakers Peter Dowd for Labour said it was right that most clauses were being delayed until after election. Trudy Harrison (Con) - MP for Copeland - made her maiden speech. Kirsty Blackman (SNP) welcomed withdrawal of dividend tax threshold change. Former Chief Secretary to the Treasury Andrew Smith (Lab) made his valedictory speech (final speech before retirement).

Group 2 - Taxation of employment income, tax avoidance and tax evasion

Clause 7 stand part + Clause 8 stand part + Clauses 9 and 10 stand part + Clause 11 stand part + Clauses 12 to 15 stand part + Gov 4 + Clause 48 stand part + Clauses 49 to 51 stand part + Clauses 124 to 126 stand part + Clause 127 stand part + Motion to transfer Clause 127 + Clauses 128 and 129 stand part + Gov 10 + Schedule 1 stand part + Gov 11 and Gov 12 + Schedule 2 stand part + Gov 57 + Schedule 16 stand part + Schedules 17 and 18 stand part + Schedules 27 to 29 stand part + NC1

The FST introduced the clauses and outlined the need to act to protect revenue in the light of changing patterns of employment.

Kirsty Blackman raised the implications of changes relating to intermediaries for rural communities especially. Also introduced her new clause relating to tax avoidance (NC1).

Group 3 - Value added tax

Clause 57 stand part + Schedule 19 stand part + NC2

The FST explained clause 57 and why govt not accepting SNP new clause (NC2) on VAT relating to Scottish police.

Kirsty Blackman argued for NC2.

Group 4 - Insurance premium tax

Clause 58 stand part + Clause 59 stand part

The FST defended the increase in IPT

Kirsty Blackman and George Kerevan (both SNP) spoke briefly.

Group 5 - Landfill tax, alcohol duties, other duties, taxation of oil and gas, etc

Clause 60 stand part + Clause 61 stand part + Clauses 62 and 63 stand part + Clause 64 stand part + 1 + Clause 65 stand part + Clauses 66 and 67 stand part + Clauses 68 and 69 stand part + Clause 70 stand part + NC3 + NC4

The FST focused her remarks on alcohol duties. An SNP new clause to stop the increase in whisky duty was rejected.

Kirsty Blackman spoke on the SNP new clause and on oil and gas taxation.

Group 6 - Soft drinks industry levy

Clause 71 stand part + Clauses 72 to 75 stand part + 2 + 3 + Clause 76 stand part + Clauses 77 to 107 stand part + Schedules 20 to 23 stand part

The FST (a former health minister) justified the levy.

Group 7 - Fulfilment businesses, digital reporting, tax administration and enforcement, and concluding provisions

Clauses 108 stand part + Clauses 109 to 123 stand part + Clauses 130 to 133 stand part + Gov 5 to Gov 9 + Clause 134 stand part + Clause 135 stand part + Schedules 24 to 26 stand part

Kirsty Blackman appreciated withdrawal of Making Tax Digital provisions. George Kerevan paid tribute to Andrew Tyrie on his retirement from the House.

FST spoke briefly.

The Bill was reported to the House as amended.

The House was then suspended for five minutes to make a decision about certification (territorial applicability). On its return the FST moved the consent motion formally (ie without a speech). The House then resolved itself into legislative grand committee for the (limited) parts of the Bill relating only to England, Wales and Northern Ireland. (I think it was only clauses 2 and 60 but advise on checking Hansard before repeating this with any certainty.) There was then an opportunity for debate on the consent motion (all members can speak but Scottish members can‚ t vote) but no-one took the opportunity. The consent motion was approved without dissent.

Third reading debate

The FST made some brief remarks on the Bill and praised Andrew Smith and Andrew Tyrie.

Peter Dowd spoke briefly for Labour. Kirsty Blackman for SNP described the Finance Bill process as bizarre. She again mentioned the Better Budgets report (produced by CIOT, IFS and IfG) and argued for Finance Bill committee to take oral evidence in future.

Rob Marris, a former Labour Treasury spokesman, made his valedictory speech, making particular reference to a register of beneficial ownership and overseas territories.

Finally the question was put by the Deputy Speaker and the Bill was approved without a vote at 3.40pm.

You can read CIOT comments after third reading here.

George Crozier CIOT Head of External Relations