Finance Bill 2020 report stage day 2

2 Jul 2020

MPs are considering amendments and new clauses tabled to the Finance Bill, relating to tax reliefs and easements and support measures in response to coronavirus. After report stage third reading debate will take place.


The timetable for the day is as follows -

Group One: Tax reliefs (new clauses and new schedules relating to any review of all tax reliefs contained in the Bill; new clauses, new schedules and amendments relating to the subject matter of any of Clauses 23, 28 to 31 and 36 and Schedules 3 and 5) - started 12.50pm; debate must conclude by 2pm

Group Two: Coronavirus response and poverty, etc (new clauses, new schedules and amendments relating to the response to coronavirus; new clauses and new schedules relating to the impact of the Bill on poverty of all persons in the UK; new clauses and new schedules relating to child poverty; remaining proceedings on consideration) - debate must conclude by 4pm

Third reading - debate must conclude by 5pm


Documents on the Bill can be read here. These include explanatory notes on the clauses and the text of amendments and new clauses tabled for debate.

Proceedings can be watched here.

You can read our liveblogs on earlier Finance Bill debates:
Second Reading debate - Monday 27 April 2020
Public Bill Committee - 1st sitting (4 June, am); 2nd sitting (4 June, pm); 3rd sitting (9 June, am); 4th sitting (9 June, pm); 5th sitting (11 June, am); 6th sitting (11 June, pm); 7th sitting (16 June, am); 8th sitting (16 June, pm); 9th sitting (18 June, am); 10th sitting (18 June, pm)
Report stage day 1 (Digital Services Tax, the Bill's environmental impact, the loan charge and off-payroll working. - Wednesday 1 July 2020 

The live blog below is contemporaneous and not checked against Hansard. We cannot guarantee that no errors have crept in and we advise on checking any passage against Hansard before repeating it.

Group 1: Tax Reliefs

Amendments and new clauses in this group

New clause 27 (Labour) would require the Chancellor of the Exchequer to report to Parliament on the number and revenue effect of the tax reliefs contained in the Bill; and on the efficiency of systems for designing, and assessing the effects of, those reliefs. - WITHDRAWN

New clause 2 (SNP) would require a review of the impact on investment of the changes made to entrepreneurs’ relief. - NOT MOVED

New clause 4 (SNP) would require a review of the impact on investment of the changes made to structures and buildings allowances in Schedule 5.- NOT MOVED

New clause 17 (Plaid Cymru / SNP) would require a geographical impact assessment of the clauses of the Bill relating to reliefs for business.- NOT MOVED

Amendment 1 (Plaid Cymru / SNP) would require the Chancellor of the Exchequer to analyse the impact of the existing EIS and the changes proposed in Clause 36 in terms of impact on the economy and geographical reach; to assess the EIS’s support for efforts to mitigate climate change; and to evaluate the Scheme’s lessons for the encouragement of UK Government-backed venture capital funds in the devolved nations.- NOT MOVED


Shadow Chief Secretary Bridget Phillipson moved new clause 27. She said there are real problems with how the government monitors tax reliefs. The NAO's work has showed how unwieldy the system is. Outcomes from tax reliefs can be positive, but we don't know enough about this as the government is failing to properly monitor and evaluate their effectiveness.  Out of 362 reliefs only 111 have been costed by HMRC and only 15 have had published evaluations since 2015. We need to see a greater focus on value for money.

She pressed the minister particularly on Social Investment Tax Relief. What consideration have the government given to extending the relief since this was raised in committee?

The new clause is limited to the reliefs covered in amendments to the Finance Bill. This is because of the restrictions on amendments to the bill. It is, she said, just a starting point to the broad review of tax reliefs Labour would like to see.

She cited the CIOT/IFS/IfG 2017 report Better Budgets - Making Tax Policy Better "which states that the information publicly available to Parliament on the costs and benefits of tax expenditure is not sufficient to assess their value for money. And they point out that although taxes constitute nearly 40 per cent of national income, Parliament has little standing support to look at tax legislation, support general enquiries on tax issues or to help with post-implementation reviews. This report had a clear recommendation: Increase support to Parliament on tax issues. Now this means going beyond support currently available and the opportunities that exist in Finance Bill committees, through the Treasury Select Committee, through the Public Accounts Committee and through other work in this house and instead embedding a proper system where we can assess the value for money of past tax measures." This is hardly controversial, she added.

Kevin Hollinrake (Con) was the next speaker. He focused his remark on the Future Fund which deals with taxpayers who have benefited from the EIS and SEIS. He declared an interest as someone who has set up companies and benefited from these reliefs in the past. He said the Future Fund was a very good scheme as it matches private sector investment. He called for the EIS and SEIS to be enhanced for a period of time.

Stephen Flynn, SNP economy spokesperson, said the UK tax reliefs system was full of inefficiencies and the SNP were aiming to be constructive in looking at entrepreneurs' relief in particular. He cited criticism of the relief from IFS but FSB had emphasised its importance. He said an internal government review was not good enough. 

On tax avoidance he repeated his 'profound concerns' about misuse of Scottish Limited Partnerships. He called for a workable General Anti-Avoidance Rule to tackle abuse in all its forms including international abuse.

He said more can be done to incentivise energy efficiency through tax reliefs. The easiest step would be to scrap VAT on building repairs.

He said his Scottish Government colleagues had called for a temporary VAT cut to 15% and a bigger cut for the hospitality industry, and a temporary 2pm cut in employer's national insurance to reduce the cost of hiring staff.

Ben Lake (Plaid Cyrmu) said a key consideration was encouraging greater investment in the parts of the UK outside London. As we rebuild after COVID-19 effectively targeted tax reliefs will have a role to play.

He spoke to amendment 1 and new clause 17 in his name, both of which relate to rebalancing economic growth across the UK. For example, he said, the share of the core research budget being spent in the 'golden triangle' bounded by London, Oxford and Cambridge was high and still rising - up from 42.1 in 2002-3 to 46% in 2017-18.

Financial Secretary Jesse Norman was the next speaker. With regard to NC27 proposing a review of all tax reliefs in the Act, he said the Government already publishes tax changes and estimates of exchequer impacts at each fiscal event and HMRC issue an annual tax reliefs statistics publication which includes estimates for the costs of tax reliefs. HMRC are also undertaking to expand their published cost information and in May HMRC published cost estimates for a further 47 previously uncosted reliefs, he added.

Officials are constantly working on ways to improve the policy development, administration and continued management of reliefs, he continued. Evaluations of 15 significant reliefs since 2015 had included R&D tax credits and entrepreneurs' relief. He said he was sympathetic to a more systematic evaluation programme for reliefs.

Regarding new clause 2 (review of entrepreneurs' relief), the government has already conducted a review, building on HMRC's earlier evaluation. A majority of entrepreneurs are unaffected. The effect of these changes to the relief will not be visible in six months time so the House should reject the new clause.

On new clause 4 (structures and buildings allowance) he reassured members that tax reliefs are already monitored in terms of the level of risk they contain. It would be neither possible nor appropriate to try to draw conclusions on the productivity or energy efficiency impact of the changes within such a short period of time.

On the issue of geographic disparity of investment he said HMRC do not routinely ask businesses to say where expenditure will be incurred. Changing this would put burdens on business. HMRC would not anyway have the information in the timescale in the amendment. 

On the EIS and SEIS clause 36, amendment 1, this was considered in committee, but it was specifically designed to deal with a market failure for young, innovative UK companies which seek to obtain patient equity financing and we would not wish to pull it away from that important national function.

He agreed with Bridget Phillipson that the tax relief system is unwieldy and more work needs to be done. Everyone is very keen on tidying up reliefs, but, he noted, they are also very keen on adding reliefs in their own particular sector.

Kevin Hollinrake intervened to ask whether the Government are considering reducing Investors' Relief which still stands at the same £10 million limit that Entrepreneurs' Relief used to. The minister replied that he thanked him for his suggestion of a revenue raising measure.

On the Social Investment Tax Relief, this remains in place till next year but it has not been as effective as anyone would have liked - only £11.2 million has been raised under it in 2014-19. He is in discussion about whether we can get more visbility on sources of funds that might use that relief. There might be other things we can do to support social investment.

Bridget Phillipson said she would not divide the House on the new clause. She looked forward to greater progress on tax reliefs. "We need to see much more from the Government... a renewed focus on taxpayer value for money, with greater opportunities for scrutiny of tax reliefs, both in this place and from external experts as well." She said it was an issue Labour hope to return to.

Group Two: Coronavirus response and poverty, etc

Amendments and new clauses in this group

Response to coronavirus (Government measures)

New clause 19 (Government) introduces New Schedule 1 (Taxation of coronavirus support payments) and provides for definitions of the various coronavirus related support schemes to which it applies. It also allows for secondary legislation to specify further schemes to which the Schedule will apply, as well as to modify the effect of the Schedule in relation to particular schemes. AGREED

New Schedule 1 (Government) makes provision about the taxation of payments made under various coronavirus related business support schemes, including the coronavirus job retention scheme (“CJRS”) and the self-employment income support scheme (“SEISS”). Paragraphs 1 to 7 clarify how payments under those schemes are to be subject to tax, following (with some exceptions) the normal principles for taxing receipts of a business. Paragraph 8 provides that where a person receives an amount to which they were not entitled under CJRS or SEISS, or misapplies an amount paid under CJRS, the person will be liable to income tax at the rate of 100% in relation to so much of that amount as was not repaid to HMRC. Paragraphs 9 to 15 make provision in connection with that charge (for example in relation to assessments and penalties). AGREED

New clause 20 (Government): In certain circumstances, people who have a protected pension age under a pension scheme (i.e. a right to receive pension benefits at an age below the normal minimum pension age) can lose it on being re-employed. This new clause prevents that happening for people re-employed as part of the response to coronavirus. AGREED

New clause 21 (Government): This new clause modifies the statutory residence test in Schedule 45 to the Finance Act 2013 so that the presence of certain individuals in the UK for purposes connected with coronavirus is discounted for the purposes of determining whether they are resident in the UK in the tax years 2019-20 and 2020-21. AGREED

New clause 22 (Government) prevents EIS and SEIS relief from being withdrawn or reduced for the purposes of income tax and capital gains tax in cases where an individual enters into a convertible loan agreement under the Future Fund with a company and subsequently receives value from the company under the agreement. AGREED

New clause 23 (Government) amends section 135 of the Finance Act 2008 to enable the Treasury to specify in an order under that section which payments of tax and other liabilities that are deferred by agreement during a period of national disaster or emergency will not attract interest or surcharges. AGREED

New clause 24 (Government) amends Schedule 4ZA to the Finance Act 2003 to provide that where a person purchases a dwelling intending it to be their only or main residence, the three-year period within which a major interest in the previous dwelling must be disposed of to be able to obtain a refund of the higher rate stamp duty land tax may be extended to a longer period if, because of exceptional circumstances, the interest was not disposed of in that three-year period. AGREED

New clause 25 (Government) provides that HGV road user levy is not chargeable in respect of the period of 12 months beginning with 1 August 2020. It provides that where the levy has been paid in respect of a non-UK heavy goods vehicle in respect of the exempt period a rebate can be claimed (no equivalent provision being required for UK heavy goods vehicles which will benefit from the exemption in respect of any period for which the levy would otherwise be paid that begins during the exempt period). AGREED

New clause 32 (Government) provides that a disqualifying event does not occur in relation to an individual as regards enterprise management incentives as a result of the individual taking leave, being furloughed or working reduced hours because of coronavirus disease. AGREED

Impact of the Bill on poverty

New clause 29 (Labour) would require the Chancellor of the Exchequer to review the impact of the Bill on poverty and consider whether the OBR should conduct such assessments as a regular duty. NOT MOVED

New clause 10 (SNP) would require the Chancellor of the Exchequer to review the impact of the Bill on child poverty. NOT MOVED


New clause 3 (SNP) requires a review of the impact on investment, employment and productivity of the changes to chargeable gains with respect to corporate capital losses over time; in the event of a free trade agreement with the USA; and in the event of leaving the EU without a trade agreement, with an agreement to retain single market and customs union membership, or with a trade agreement that does not include single market and customs union membership.  NOT MOVED

New clause 6 (SNP) would require the Chancellor of the Exchequer to review the effect on public finances, and on reducing the tax gap, of Clause 99 and Schedule 14, and in particular on the taxes payable by owners and employees of Scottish Limited Partnerships. NOT MOVED

New clause 7 (SNP) would require the Government to report on the effect of Clause 79 on a number of business sectors.NOT MOVED

New clause 8 (SNP) would require a government review of the effects on measures in the Bill of certain changes in migration levels. NOT MOVED

New clause 9 (SNP) would require a government review of the effects of the measures in the Bill on migration levels. NOT MOVED

New clause 11 (SNP) would require the Chancellor of the Exchequer to review the impact of the Bill on equalities. NOT MOVED

New clause 15 (SNP) would require the Government to report on the effect of the Bill on a number of business sectors. NOT MOVED

New clause 16 (SNP) would require the Chancellor of the Exchequer to review the effect on public finances, and on reducing the tax gap, of the Bill; and in particular on the taxes payable by owners and employees of Scottish Limited Partnerships. NOT MOVED

New clause 30 (Conservative backbenchers, led by Sir Graham Brady and Theresa May) would require that the changes to APD in clause 88 not come into force until a review of the effect of changes to APD has been published by the Treasury. NOT MOVED

Amendment 2 (SNP) would require the Government to review the impact of the proposed changes to alcohol liquor duties on public health. NOT MOVED

Amendment 3 (SNP) would require the Government to review the expected impact of the revised rates of duty on tobacco products on public health. NOT MOVED

Amendment 4 (SNP) would ensure that vehicles carrying human breastmilk would benefit from the exemption from Vehicle Excise Duty. NOT MOVED

Amendment 5 (SNP) would leave out clause 95 (International Trade Disputes). NOT MOVED

Amendment 6 (SNP) would require the Government to state the conditions under which it would consider it appropriate to vary rates of import duty in an international trade dispute. NOT MOVED

Amendment 7 (SNP) would require the Government to seek the approval of the House before making regulations varying rates of import duty in an international trade dispute. NOT MOVED

Amendment 8 (SNP) would require a review of the economic and fiscal impact of the use of the powers in clause 95 including comparing those effects with EU Customs Union membership. NOT MOVED

Amendments 9-15 (all SNP) amend clause 96 seeking to limit the extent of HMRC’s status as a preferential creditor in insolvencies by preventing the policy from being applied retrospectively and by limiting that preference to only those taxes which became due in the 12 months before the relevant date as given in the Bill (1st December 2020). NOT MOVED


Debate on this group began at 1.50pm, with Financial Secretary Jesse Norman the first speaker.

He explained the amendments relating to coronavirus were part of a much more extensive response to this epidemic. He paid great tribute to HMT and HMRC officials, without whose work it would not have been possible to deliver many elements of the response, let alone in such a rapid timetable. This legislation is being brought forward at the earliest opportunity available. 

New clause 19 seeks to do two things - to confirm grants made under Covid related schemes are subject to tax; it also includes delegated powers. The second part ensures HMRC have appropriate enforcement powers to ensure taxpayer money is going only to people eligible. "HMRC have given a clear undertaking that these powers will not be used to penalise taxpayers who may be going through difficult times, but make honest mistakes in their applications." 

New clause 20 seeks to mitigate potential pensions impacts for those with a protected pension age returning to work in order to battle the pandemic. New clause 21 temporarily relaxed the statutory residence test so that highly skilled individuals from across the world are not discouraged from coming to the UK and helping this country to respond to the unprecedented health emergency. It only applies between March 1 and June 1 2020.

New clause 22 modifies the current EIS and SEIS so individuals who made EIS or SEIS investments before a Future Fund investment in the same company will not lose relief on those previous investments when the Future Fund loan converts into shares or is repaid.

New clause 23 enables HMT to specify which payments of tax and other liabilities will not attract late payment interest or surcharge as a result of being deferred by agreement during a period of national disaster or emergency. 

New clause 24 allows a refund of additional higher rate of stamp duty in some circumstances to ensure responsible actions take by people do not lead to negative tax implications for people. New clause 25 suspends HGV road user levy for 12 months. New clause 32 makes a minor change to existing EMI legislation.

Wes Streeting, Shadow Exchequer Secretary, spoke next. He said that throughout the pandemic Labour had sought to work constructively with the Government and in that spirit had helped expedite the progress of measures put forward by the Government and this afternoon would be no exception. He did want to speak to Labour's NC29, which speaks to the Government's 'poverty of ambition' on tackling poverty.

The Government is failing on something that should be among the most basic priorities for any government, he said, referring both to current poverty statistics and to his own experience growing up in poverty in a council flat in the East End of London. He said that while he welcomed the Chancellor's actions in response to Covid-19 so far, unless he goes further many people will be facing greater poverty and hardship later this year. It remains to be seen whether this Chancellor is prepared to do 'whatever it takes' to tackle poverty in our country, he added, praising the record of the Blair and Brown governments in tackling poverty.

Next week the Chancellor will deliver an economic update, said Streeting. The Prime Minister had over-promised and under-delivered with his recent announcement. He hoped the Chancellor would do the opposite, and bring forward a full 'back to work Budget'.

On New clause 30, Sir Graham Brady, Conservative, calls for a ‘quick’ review of changes to APD. The Finance Bill only allows an increase in APD, but the Government must look at the benefits of a reduction. The effect on aviation been exacerbated by Foreign Office advice. The real purpose of this new clause is to flag the importance of this issue ahead of the financial statement next week by the Chancellor. There is a danger that APD will not be an easy source of money for the economy. Even a temporary reduction should be debated so we can look at its broader benefits. He did not press the new clause to a vote in the hope to see proposals in the upcoming mini-Budget next week.

Alison Thewliss, SNP economic spokesperson, said we have seen a vacuum of economic strategy in recent years because the country lurches from one crisis to another. The inequalities that have been exposed because of COVID-19 crisis must be addressed in the long term. She contrasts a lack of action on child poverty in Parliament with the Scottish Government’s strategy to eradicate child poverty by 2030. There was a slightly ill tempered exchanged between Thewliss and some Conservatives when she complained about the morality of refurbishing the PM’s plane when some young people are living in poverty in Scotland. She is concerned about social security cuts of £3.7bn in 2020/21. Mitigation is not sustainable. Public services have been devasted in the past ten years and austerity not continued.

She said it is extremely concerning that the Government are pushing ahead with plans to wind support schemes down, particularly concerning New Clause 19 of this Bill of [inaudible] grants to help businesses to employers, individual partners, partnerships effected by this COVID-19 crisis, as taxable income. It is concerning hat HMRC will be given new compliance to enforce these rules but that has not been effectively communicated to businesses. Any new powers to HMRC must be proportionate and serve to aid recovery rather than provide another barrier for businesses to overcome. These concerns have been backed by CIOT which said it is vital that HMRC take a reasonable approach to enforcement in these cases. There will be inadvertent errors by taxpayers, and it is essential HMRC take an understanding and targeted approach in their compliance activity in the months ahead.

She talked of the value of a ‘green new deal’. She also spoke in support of a reduction in VAT for some goods.

Mark Jenkinson gave his maiden speech.   

Mary Kelly Foy, Labour, called the Government’s record on child poverty and workers’ rights ‘shameful’. Four million children live in poverty in the UK, she laments. There are 600,000 more children living in relative poverty than 2012. Impact of COVID-19 will make matters worse. On the free school meals U-turn, she said it is shameful that a government has to be embarrassed to feed children. The Government’s view that poverty is to do with individual circumstances says they are poorly equipped to deal with child poverty. She is worried that the PM’s denies there is a problem with child poverty.

Aaron Bell, Conservative, said the world has changed since the March 2020 Budget. The Treasury has been a leading example to the rest of the world on how to deal with financial impact of COVID-19. We should not underestimate how difficult it is for the high street to adapt to COVI-19 requirements to trade. He is glad to see the Government legislating to protect pensions. The Finance Bill is full of ambition for the UK.

Claudia Webbe, Labour, said in 2018 the number of children living in poverty increases by 100,000. BAME families twice as likely o be in poverty than white British families, which has created a perfect storm for the COVID-19 virus to exploit. Government must treat child poverty as the national scandal it is.

On New Clause 30, Andrew Griffith, Conservative, said the UK will be the worst effected country in the EU in terms of aviation-related revenue because of COVID-19. Why should an empty plane pay the same APD as a full plane? He claimed APD especially on domestic travel leads people to take long polluting drives instead of flying. APD is not a large source of revenue for the Treasury, he said, and with Heathrow saying flights at three percent means APD will be paltry this year. The clause will ‘strengthen the union’ by supporting domestic flights and to simplify the tax system by accepting he amendment.

Matt Western, Labour, said one in eleven households live in energy poverty, and complained about the lack of quality social housing built at scale. The Finance Bill is missing the support we need for the Treasury for the automotive industry to protect jobs. He urges the Government to extend the furlough for people in at risk sectors, such as leisure and hospitality. He welcomes reform to vehicle excise duty and the money for charging structure – but we must be bolder like Norway (e.g. reduced road tax; free municipal parking; and VAT exemption). He wants the Treasury to look at how they can use the tax system to incentivize the punches and uptake of cleaner vehicles and support our automotive sector to get them firing on all cylinders, again.

Sarah Olney, Lib Dem, would like to see a commitment to more diverse ways of teaching for pupils who have got used to different ways of learning during the COVID-19 crisis. The Government should commit to retraining career changes to help people who have lost jobs in the pandemic; especially engage with women. The Government should make every effort to support pre-school provider and universities. Young people should be prioritised in the recovery from COVID-19, and talked up the fantastic opportunity implement to carbon free and low carbon standards into construction of new homes and transport systems.

Rachel Hopkins, Labour, spoke on New clause 29. The Government will not tackle successfully child poverty until it is put at the heart of its economic policy. The Government has created a situation where work does not take people out of poverty. She wants to a ‘full Budget’ next week which includes see social security reform, suspend benefit cap, abolish two-child limit and removing 16,000 universal credit saving limit, converting universal credit loans to grants and uprating legacy benefits to match increase in universal credit.

Fleur Anderson, Labour, on New clause 29, she said there should be more independent scrutiny to help ensure policy interventions across Whitehall help the most disadvantaged groups. This Bill must not add to backwards trend in the past 20 years on child poverty.

Ruth Jones (Labour) warned that the UK was only at the end of the first wave of Coronavirus, and warned of the need to remain vigilant to the economic impact of future outbreaks, as highlighted by the situation in Leicester. She called for "common sense and decency" in the government’s economic approach to recovery, was critical of the government’s initial approach to free school meals and warned of the dangers of the reintroduction of benefits sanctions as the country emerges from the pandemic.

Summing up the report stage for the government, Jesse Norman defended the government’s record in tackling poverty and praised Streeting for a "very moving, personal speech". He said that the new clauses proposed were unnecessary as, for the most part, the information requested was already in the public domain.

Norman said that the government was working very closely with the aviation industry to address their concerns related to the pandemic, but said that the changes to APD proposed by the Bill – such as the £2 increase for international flights – were relatively small and represented "the cost of a rather inexpensive coffee at airport prices".

MPs agreed that New Clause 19 be added to the Bill and that remaining new government clauses 20-25, 32 and new schedule 1 be agreed. These were agreed without division.

Third reading debate

Jesse Norman began by telling MPs that the Finance Bill was being in the shadow of a pandemic unprecedented in both its scale and reach and that the government was keenly aware of the immense challenges and pressures that the country faced.

He said that these concerns "cannot and will not be ignored" and stressed that the government was working hard to allieviate the impact of Coronavirus on the economy, public finances and the health and wellbeing of every person in the UK. He described the range of support measures put in place by the government as being on "a scale hitherto unseen in peacetime, and necessarily so".

Norman said that the measures contained in the bill would protect emergency services and cited the pension taper changes that will enable doctors to work without fear of punitive tax bills. He paid tribute to public sector workers and singled out the efforts of Treasury and HMRC officials for their efforts.

Norman also said that public services could not be provided "without a fair and sustainable tax system". The government’s aim, he said, was to maintain this while seeking to remain competitive. He said that the 19 per cent Corporation Tax was such as example, with the 19 per cent rate a sign that the UK was a place for inward investment.

The Financial Secretary said that the Bill provided fairness in the tax system in a number of ways. The introduction of the Digital Services Tax would ensure that digital companies contributed a fairer share of their revenues to the public purse while a delay to the implementation of off payroll working rules would give businesses and taxpayers more time to prepare.

Norman also spoke to changes to R&D tax credits and the Structures and Building Allowance as providing opportunities to investment, innovate and level up across the UK, while maintaining a Carbon Price floor once the UK leaves the EU would ensure that the country continues to meet its commitments to being a net zero emitter of carbon.

The Minister concluded his remarks as he began, noting that the world had changed significantly since the Bill had been introduced and defending the government’s measures as a foundation on which to rebuild the economy and protect public finances.

Bridget Philipson said that the Bill failed to recognise the scale of the challenge facing the UK and described the legislation as ‘a Finance Bill for a different age’. She contrasted the economic impact of the 2008 financial crisis with the situation today, citing emerging job losses and the need to ensure in particular that young workers and older workers in need of retraining are protected.

Philipson said that the opposition would be looking to the chancellor to deliver a "full back to work budget" next week. She called on the government to ensure that "those with the broadest shoulders pay their fair share" to fund the UK’s economic recovery.

On tax matters, Philipson said that rather than raising revenues, the Bill extended and expanded tax reliefs, tinkered with rather than end Entrepreneurs’ Relief and excluded high grossing streaming services, such as Amazon and Netflix, from being liable to pay the Digital Services Tax.

While the opposition welcomed the introduction of the Digital Services Tax, Philipson said that the £440 million it is forecast to raise was dwarfed by the £1.3 billion in Corporation Tax that she said the UK’s five biggest tech firms had avoided.

She said that this money could have been used to help schools return safely, employ more nurses and doctors, fund job creation schemes and support public health research and the government’s decarbonisation agenda.

She concluded by saying that the opposition would continue to be constructive in its dealings with the government, but that it needed to be more innovative in its approach to the post-Coronavirus economic recovery.

For the SNP, Alison Thewliss said that there was "some hope for the future" that the government may reverse some of the measures that her party disagreed with, given the manner in which it had responded to the challenges of the pandemic and prioritised spending in areas she suggested might have been regarded as unimaginable in the past.

She repeated the need for Finance Bill committees to be allowed to take evidence, which was a practice commonplace across other Westminster committees. She said that it was "ludicrous" that MPs were prevented from taking oral evidence from experts and called for a Standing Committee on the Budget to "keep an eye on" the government’s policy agenda.

Thewliss also warned that issues around the loan charge and IR35 would not go away, "as much as the government would like it to".

In additional remarks, she was critical of the government’s "far from impressive handling of the COVID crisis" and called on Ministers to ensure that the economic recovery put wellbeing and people first. To achieve this, she said that the Financial Secretary to the Treasury should lobby the chancellor to be bolder, retain the job retention scheme and ensure continued government support for sectors of the economy that have still to emerge from lockdown.

Anthony Browne (Conservative) said that the tax measures contained in the Bill struck a good balance between tackling tax avoidance and encouraging entrepreneurialism. Browne said that while his instincts were to cut, rather than introduce new taxes, new levies on carbon, plastics and digital companies were justified and necessary in order to change behaviours. He also expressed optimism at the UK's ability to bounce back from the economic damage caused by Coronavirus and warned of th eneed to avoid returning to the economic challenges of the 1980s.

Felicity Buchan (Conservative) commended the Digital Services Tax. She expressed hope it would be soon be superseded by an international tax, but for the moment, described it was a bold, interim measure that would deliver revenues to the Treasury and help level the playing field between online and high street retailers in her Kensington and Chelsea constituency. Buchan also looked forward to a more fundamental review of the Business Rates regime that is expected later this year.

The final speaker in the debate, Duncan Baker (Conservative) applauded the "hugely progressive" and "pioneering" Digital Services Tax. He said that its introduction "couldn’t come quick enough" as it would represent the first step in an effort to help protect high street retailers struggling because of the pandemic and competition from online sellers.

Baker said that he hoped the Digital Services Tax would be a stepping-stone towards further measures aimed at online retailed and expressed his support for the introduction of an online, VAT-style sales tax to be levied on all online retail sales. He said this measure would enable the Treasury to abolish retail Business Rates and help level the playing field between traditional and online retail.

The debate concluded at 4.19pm.

By George Crozier