Finance Bill 2025-26 Committee: Winter fuel payment charge and taxi tax passed

Government amendments were passed to schedule 23 (aggregates tax) and clause 110 (economic crime levy). No non-government amendments were passed.

Other measures passed by MPs included the charge implementing the means-testing of pensioner winter fuel payments, a tightening of the VAT rules for taxi and minicab providers and reforming the taxation of ‘carried interest’ to tax it as income. Further clauses give ministers more powers to apply tariffs, amend the VAT rules for charitable gifts by companies, and extend the existing inheritance tax relief for infected blood compensation payments.

Again, shadow ministers raised CIOT and LITRG concerns on a number of the measures.

You can view the amendments paper here. The Bill can be read here. Explanatory notes can also be read here.

Sitting 3: Thursday 29 January 2026, 11.30am

PART 1 - INCOME TAX, CAPITAL GAINS TAX AND CORPORATE TAXES (continued)

Winter fuel payment charge (clause 55 plus schedule 10, opposition amendment 41 and new clauses 10 and 27)

Exchequer Secretary to the Treasury (XST), Dan Tomlinson, opened the committee’s third sitting by explaining that this clause and schedule would support recovery of the pensioner winter fuel payment through the tax system, which was chosen to avoid means-testing at the point of payment while targeting support toward those on lower incomes.

Opposition members raised concerns about complexity and the choice of income basis. Shadow Exchequer Secretary James Wild referenced written evidence from the Chartered Institute of Taxation and the Low Incomes Tax Reform Group, who raised concerns about “the potential complexity of the clause; about how it could cause anxiety for people who have not had to navigate tax rules before; and about how the £35,000 per year cap will only diminish over time as inflation eats away at it.”

The shadow minister criticised the static threshold, noting: “Without uprating, inflation alone will mean more and more pensioners are caught by this charge, even though there has been no real increase in their standard of living.” His new clause 10 sought to require the reporting of the impact on households and on the Exchequer of uprating the income threshold annually in line with CPI. Amendment 41 went further, seeking to put that commitment “squarely on the face of the Bill”.

CIOT and LITRG had also pointed out that, “if a pensioner’s income is £1 over the threshold, they will lose the entire winter fuel payment; there is no taper”, the shadow minister noted. Also, “unlike other income-related charge-backs, such as the high-income child benefit charge or the tapering of the personal allowance, the winter fuel payment is based on total income, not adjusted net income.” This means it will affect pensioners who are seeking relief on their charitable contributions. He wondered why the government had opted for this approach.

Lib Dem spokesperson Joshua Reynolds gave his support to amendment 41, as well as his own new clause 27, which “aims to review the practical impact of the winter fuel payment changes, especially on those individuals who exceeded the income threshold by only a small amount”.

Another Lib Dem, Martin Wrigley, wondered if it would not be “much simpler and more efficient to wind this into the main pension in future years”. “Labour Members do not think that it is right for the super-rich to continue to receive the winter fuel payment,” replied the minister.

Clause 55 and schedule 10 – passed.

Division: Amendment 41 was rejected by 2 votes to 9.

New clauses are decided upon at the end of the committee stage.

Carried interest (clause 56 plus schedule 11 and opposition new clause 11)

The XST said the clause aligns tax treatment with economic substance and tackling avoidance in this area. It introduces a revised tax regime for carried interest that sits wholly in the income tax framework.

The Shadow XST welcomed the objective but sought assurance on clarity for practitioners, asking in particular about potential knock-on effects for smaller funds.

Clause 56 and Schedule 11 - passed.

New clauses are decided upon at the end of the committee stage.

Collective money purchase schemes and Master Trust schemes (clause 57)

The XST said the clause would allow HMRC to refuse to register, or to deregister, an unauthorised CMP pension scheme, and “allow regulations to be made to efficiently support the development of those CMP schemes”.

The Shadow XST backed the plans, pointing to evidence from the CIOT that the current framework “does not allow for reductions in pension payments that vary between different groups of members”. However, he added: “Under the new guided retirement model expected from 2027, trustees will be making complex decisions on behalf of their members yet, as the Chartered Institute of Taxation notes, trustees will hesitate to act without sufficient flexibility such as limited opt-out periods or conversion options.”

Clause 57 – passed.

Corporate interest restriction (clauses 58-59)

Clause 58: Corporate interest restriction: reporting companies
Clause 59: Corporate interest restriction: capital expenditure and tax-EBITDA calculation

The Government argued that the changes provide consistency and prevent manipulation rather than widening the regime’s scope. The main change is the removal of the time limit to appoint a reporting company, as well as the requirement for the appointment to be made by notice to HMRC, said the XST.

The shadow XST noted that clause 59 corrects “distortions in the corporate interest restriction rules that discourage capital investment in environmental and infrastructure projects”. “If the calculation of tax-EBITDA has accidentally penalised spending on projects such as flood defence, waste treatment or crematoriums, are there are other sectors that… might face similar unintended consequences,” he wondered. He asked for a wider review of the corporate interest restriction rules to ensure that the system generally supports long-term environmental and infrastructure investment.

The minister said he was aware of no further sectors affected in this way. On the request for a review he gave the usual government response that all taxes are kept under review.

Clauses 58 and 59 – passed.

Avoidance schemes involving certain non-derecognition liabilities (clause 60)

The XST said the clause seeks to prevent avoidance through arrangements involving certain liabilities that do not give rise to recognised tax assets or losses. He added that Budget 2025 costings say this measure is expected to raise around £20 million in 2025-26, rising to £145 million by 2028-29. “It blocks schemes that seek to erode the UK tax base,” he said.

The shadow XST wanted to know how HMRC will distinguish between abusive non-derecognition schemes and bona fide securitisation deals that have valid commercial purposes, and what guidance will be published to provide clarity around the new main purpose test “so that businesses have confidence and know which existing structures could be at risk”.

Clause 60 – passed.

Energy profits levy (clause 61 plus opposition new clause 12)

Clause 61: Energy (oil and gas) profits levy: decommissioning relief agreements

The XST said this clause introduces legislation “to expressly state that no payments can arise under decommissioning relief agreements in relation to the energy profits levy”.

MPs questioned whether investor certainty and energy sector investment incentives had been fully considered, with new clause 12 tabled to require a review of the impact of the levy on investment and decommissioning decisions. The Shadow XST, who tabled the new clause, said: “The reality in the North Sea is stark. Investment has sunk to record lows and, according to research from Robert Gordon University, jobs are being lost at a rate of 1,000 a month.”

The shadow minister added that: “The decommissioning reliefs to which this clause refers were designed to give long-term certainty on tax treatment in the basin, precisely so that companies could plan for responsible decommissioning.”

Clause 61 - passed.

New clauses are decided upon at the end of the committee stage.

PART 2 - INHERITANCE TAX

Clauses 62-69 were debated and agreed in Committee of Whole House

Provision relating to new regime in FA 2025 (clauses 70 to 73)

Clause 70: Relevant property: disapplication of exemptions from exit charges
Clause 71: Relevant property: cap on charges for pre-30 October 2024 excluded property
Clause 72: Foreign diplomats etc: periods of UK residence to be disregarded
Clause 73: Minor corrections

The XST said these clauses improve the residence-based regime for inheritance tax, which came in last April. “Clause 70 is an anti-avoidance provision, ensuring the settlor and its trust cannot manipulate excluded property rules to avoid an exit charge on ceasing to be a long-term UK resident. Clause 72 confirms that years of diplomatic service do not count towards the long-term UK residence test. Clause 73 makes minor corrections… [relating to] spouse elections to be long-term UK residents and [to] non-residents’ bank accounts. Clause 71 introduces a new £5 million cap on inheritance tax charges every 10 years on trusts of former non-doms.”

Beginning his remarks with a reference to pre-Budget ‘kite flying’ about a 20% exit tax, the Shadow XST warned of “risk about the message that it sends about encouraging people to this country”. He added that: “The Chartered Institute of Taxation has pointed out that individuals faced with the prospect of UK inheritance tax on their overseas trusts may already have decided to leave the UK and/or wind up the trust.”

Clauses 70 to 73 – passed.

Infected blood compensation payments (clause 74 plus opposition amendments 46-48)

This clause introduces a power to extend the existing inheritance tax relief for infected blood compensation payments.

The Liberal Democrats tabled amendments 46–48 to this clause, seeking to broaden the exemption and include additional protections. Joshua Reynolds said the government’s policy paper “was unequivocal that compensation must be a matter of entitlement rather than charity, and our amendments would ensure that those promises were kept and not kicked into the long grass.”

 “Amendment 47 would ensure that all the regulations face proper parliamentary scrutiny through the affirmative procedure,” he explained. “Amendment 46 would require the Chancellor to make regulations within 60 days mandating consultations with victims’ organisations and the Infected Blood Compensation Authority… Amendment 48 would require the Treasury to demonstrate how it meets key objectives: that for any victim faced with inheritance tax on their payments, the treatment is fair, regardless of the timings; and that administrative processes do not create additional distress.”

The Shadow XST gave his backing to the amendments, especially amendment 46, which “would establish a mechanism to support families to navigate the system”.

The XST welcomed the support of the opposition parties for the clause, but he rejected the Lib Dem proposals. Making all the regulations under the affirmative procedure (rather than just where they amend primary legislation) would not be consistent with usual practice, he said, suggesting it might delay speedy action. The Treasury statement sought by amendment 48 was unnecessary, he continued, while, in relation to amendment 46, the government was already consulting with stakeholders.

Divisions: amendments 46 and 47 were both voted on and were both defeated 9-4.

Clause 74 – passed.

Gifts to charities and registered clubs (clauses 75-76 plus new clause 13)

Clause 75: Scope of exemption for gifts to charities and registered clubs
Clause 76: Section 75: transitional protection for existing interests in possession

The XST said that the clauses reflected long-standing principles of inheritance tax charitable exemptions and close an avoidance loophole “to ensure that the inheritance tax exemption for gifts to charities works as intended”.

New clause 13, tabled by the Conservatives, called for a report on the impact of clause 75. The Shadow XST said: “We agree with the principle of ensuring that charitable reliefs are used as intended, but it is also important that the government understand the practical consequence of any tightening of the rules.”

Clauses 75 and 76 – passed.

New clauses are decided upon at the end of the committee stage.

PART 3 – OTHER EXISTING TAXES

VAT and insurance premium tax (adapted vehicles) (clauses 77-78)

Clause 77: Zero-rating of leases of vehicles to recipients of disability benefits
Clause 78: Insurance premium tax relief limited to adapted vehicles

The XST said the Motability scheme “benefits from generous tax breaks that are supporting provision beyond the scheme’s core objectives, such as the lease of luxury cars”. The Shadow XST agreed, adding: “That is a fair and balanced reform that we wholeheartedly support.” Joshua Reynolds (Lib Dems) sought clarifications but the minister was unwilling to go beyond the definitions in the legislation.

Clauses 77 and 78 – passed.

Sitting 4: Thursday 29 January 2026, 2pm

VAT (Private hire vehicles or taxis) (clause 79 plus amendment 42 and opposition new clause 14)

The Shadow XST branded the measure a “taxi tax”, that will “increase fares, hurt rural and vulnerable passengers and create fresh uncertainty in a vital sector”. He observed that “some major operators, including Uber, have reclassified themselves or are exploring ways to reclassify themselves as technology platforms rather than transport providers… If they succeed, the VAT liability would shift from the company to the individual drivers, many of whom are not VAT-registered owing to their earnings level.”

He also noted ICAEW concerns that the list of qualifying services for the Tour Operators Margin Scheme is too narrow, in that it excludes trips, excursions and the services of tour guides. “That creates a genuine issue for tour operators who supply day-trip packages,” he said.

Another particular concern was, he said, rural areas, due to their high reliance on the use of taxis and private hire vehicles. His amendment 42 sought to exempt rural communities from this measure.

Joshua Reynolds (Lib Dem) was also concerned about Uber, noting Guardian reporting that the company “has swerved paying millions of pounds” by simply rewriting its contracts with drivers so that it acts as an agent, rather than as the supplier outside London (Transport for London having prevented the agency model operating within London). “Why are we now in a position where we have an absurd two-tier system in which identical journeys are taxed differently depending on whether they take place inside or outside London,” he asked.

Martin Wrigley (Lib Dem) expressed concern about the impact on council-commissioned transport, including SEND services, and sought clarity on whether taxis used for those services would be included under the standard-rated regime.

Responding, the XST said he wouldn’t comment on the affairs of individual taxpayers (such as Uber). He was confident the measure was appropriately targeted and the changes “will put to an end the exploitation, by a small number of private hire vehicle operators, of an administrative scheme that is intended for tour operators only”.

Division: Amendment 42 was defeated 5-9.

Clause 79 – passed.

New clauses are decided upon at the end of the committee stage.

Certain charitable donations not to be treated as supplies of goods (clause 80 plus opposition amendment 43)

Clause 80 addresses an inconsistency in the VAT rules. Under current legislation, goods donated by VAT-registered businesses to charities for resale (for example, through a charity shop) are not subject to VAT, whereas goods donated for use by the charity or onward distribution to people in need are usually subject to VAT at 20%. Clause 80 seeks to address this inconsistency by allowing certain donations for use or distribution by the charity to be treated as outside the scope of VAT, meaning no VAT is due. 

The Shadow XST said that, while his party support the principle behind the measure, it would like to see changes. He cited concerns from the Association of Taxation Technicians over how the changes “do not fully match the existing relief for goods donated for resale”. “Businesses will still face different VAT treatments, depending on how a charity uses the donated items,” he added. He proposed an amendment to provide for the £200 applicable limit to be uprated annually in line with inflation.

Joshua Reynolds agreed and said the Liberal Democrats would support the amendment, adding it was “unacceptable” that goods were disposed of rather than donated as it was cheaper to do so.

The XST said the price of many goods has been decreasing in real terms, which is why the threshold had not been uprated.

Division: Amendment 43 was defeated 9-5.

Clause 80 – passed.

Refunds of VAT to combined county authorities (clause 81)

Clause 81 adds combined county authorities to the list of bodies eligible for VAT refunds. It was backed by both the Conservatives and Lib Dems.

Clause 81 – passed.

Stamp duty reserve tax (Clause 82 plus opposition new clause 15)

The XST explained that the clause will remove the 0.5% stamp duty reserve tax charge on the transfer of a company’s securities for three years from the point at which the company lists its shares on a UK-regulated market.

The Shadow XST called this type of tax (stamp duties of all kinds) “among the most economically inefficient [of taxes]: it dampens the market, prevents people from moving and undermines labour market flexibility”. Tabling new clause 15 for a review of the effectiveness of stamp duty on shares, he added: “If the goal is to make London and other UK markets more attractive to list on by cutting the transaction costs and supporting liquidity in the critical early trading years, we need to understand what the success measures are.”

Shadow Economic Secretary Mark Garnier (Con) challenged the government to “go the whole hog and get rid of stamp duty altogether”.

The XST said: “Stamp duty reserve tax and stamp duty are charges on transfers of UK securities. They are vital sources of revenue for the Exchequer, and combined they are forecast to raise up to £5.3 billion a year by the end of the forecast period.”

Clause 82 – passed.

New clauses are decided upon at the end of the committee stage.

Clauses 83-86 were debated and agreed in Committee of Whole House

 Tobacco products duty (Clauses 87 and 88 plus opposition new clause 31)

Clause 87: Rates of duty effective from 6pm on 26 November 2025
Clause 88: Rates of duty effective from 1 October 2026

The XST confirmed tobacco duty will rise again in October in line with the introduction of vaping duty. “That is to preserve the price differential between vaping and tobacco products to ensure the duty on vaping does not make smoking more attractive, and will maintain the incentive to choose vaping over smoking,” he added.

New clause 31, requiring an assessment of the impact of these changes on the illicit tobacco market was tabled by the Conservatives. The government rejected this on the basis that consideration of illicit market effects was already integral to duty decisions.

Clauses 87 and 88 – passed.

New clauses are decided upon at the end of the committee stage.

Vehicle excise duty for light passenger or light goods vehicles etc (clause 89 plus opposition new clause 17)

Clause 89 uprates vehicle excise duty (VED) rates for cars, vans and motorcycles in line with RPI inflation from 1 April 2026, the XST told the committee.

The Shadow XST said the changes would “in practice… mean higher costs for almost every driver” and his new clause would seek an assessment of this.”

“Motorists and motoring organisations including the RAC have rightly warned that these charges come at a time when the cost of living remains high and public transport options are patchy,” he added. “For many in rural areas like my own, a car is not a luxury but a necessity to get around, get to work and see family.”

Clause 89 – passed.

New clauses are decided upon at the end of the committee stage.

Vehicle excise duty (goods and haulage vehicles) (clauses 90-93 and 95 plus opposition new clause 18)

Clause 90: Vehicle excise duty for rigid goods vehicles without trailers and tractive units
Clause 91: Vehicle excise duty for rigid goods vehicles with trailers
Clause 92: Vehicle excise duty for vehicles with exceptional loads etc
Clause 93: Vehicle excise duty for haulage vehicles other than showman’s vehicles
Clause 95: Rates of HGV road user levy

The Shadow XST said his party have concerns about the timing of the increases to these VED rates for various kinds of lorries and goods vehicles, and about the “absence of meaningful backing for the most affected industries”. HGV VED is already complex, with more than 80 different rates, varying based on the characteristics of weight, emissions, class and configuration,” he added.

Joshua Reynolds (Lib Dems) agreed that the haulage sector has seen “significant challenges” in recent years, adding: “If we add that to the £2,000 cost per truck of the changes to vehicle excise duty, we see very clearly that the significant changes that the government are making in quick succession are not helping the sector, which needs all the support it can get.”

The XST responded that the government is “providing stability” for the private sector following the “relatively chaotic approach” of the previous government.

Clauses 90-93 – passed. Clause 95 was passed following debate on clause 94 (below).

New clauses are decided upon at the end of the committee stage.

Vehicle excise duty: expensive car supplement (clause 94 plus opposition new clause 19)

The XST said the increase in the expensive car supplement threshold from £40,000 to £50,000 would benefit “over half a million drivers of zero emission vehicles over the next five years” as well as incentivising electric vehicle take-up. 

The Shadow XST responded, questioning the lack of support for hybrid vehicles “despite the fact that they are critical in bridging the transition to fully electric vehicles”. He added the clause will not “do anything for most of the households in our constituencies, who simply cannot afford a new electric vehicle”. His new clause 19 would require “a proper review of the policy, its effects on the automative sector and the impact on the sale of hybrid cars and on vehicle excise duties.”

Joshua Reynolds raised concerns over the import of electric vehicles from China, “undercutting European and British competitors”. “I am sure that we do not want a world in which the government are unintentionally encouraging British residents to buy electric vehicles made in China rather than electric vehicles from Britain,” he added.

Clause 94 – passed.

New clauses are decided upon at the end of the committee stage.

Rates of air passenger duty (clause 96 plus opposition new clauses 20 and 32)

The clause would “make sure that airlines continue to make a fair contribution to the public finances,” said the XST. “Particularly given that tickets are VAT-free and aviation fuel incurs no duty.” Following previous increases to APD, the government will uprate rates in line with RPI from 1 April 2027.

The Shadow XST raised concerns over the cost of holidays and business trips, tabling new clause 32, which would require boarding passes to show how much this “stealth tax” has added to their cost. His new clause 20 would require the government to publish an impact assessment of the APD changes on the aviation industry, on passengers, on households of all income levels and on the public finances.

Clause 96 – passed.

New clauses are decided upon at the end of the committee stage.

Rates of climate change levy (clause 97 plus opposition new clause 21)

The XST said the climate change levy has, since its introduction in 2001, provided an incentive for businesses and the public sector to improve energy efficiency, and that uprating ensures its behavioural incentive is maintained while protecting the public finances. He added: “Energy efficiency is one of the most cost-effective ways in which businesses can cut emissions, and permanently reducing energy use also helps to improve the UK’s energy resilience.”

The Shadow XST emphasised the pressure on UK manufacturers relative to competitors abroad, noting that they face higher energy costs than their European and US counterparts. He argued: “High energy costs are one of the issues holding back growth … we should be looking to reduce the burden and cost of energy, rather than increase it”. He tabled a new clause 21 which would require a report on the impact of this clause on energy-intensive industries and the UK’s international competitiveness.

Clause 97 – passed.

New clauses are decided upon at the end of the committee stage.

Rates of landfill tax (clause 98 plus opposition new clause 22)

This clause simply uprates landfill tax by inflation but debate ranged more widely on the design of landfill tax. The XST said that the government had consulted widely on the tax’s design and that industry responses had been positive, with bodies such as the National Federation of Builders stating that the approach would “allow the industry to start preparing for the circular economy.”

The Shadow XST recalled the “intense speculation” ahead of the Budget that the government might move to a single landfill tax: “The speculation did not come from nowhere; it came from a government consultation that proposed to do precisely that.” “Material such as topsoil could have faced a thirty-onefold increase,” he claimed.

His new clause 22 sought a report on the impact of this uprating, including any effects on construction and infrastructure projects, port investment, recycling and illegal dumping, progress towards environmental objectives and Exchequer revenues.

Clause 98 – passed.

New clauses are decided upon at the end of the committee stage.

Aggregates levy (clauses 99-100 plus Schedule 23, government amendments 26-28, motion to transfer and opposition new clause 23)

Clause 99: Rate of aggregates levy
Clause 100 and schedule 23: Aggregates levy: amendments relating to disapplication of levy to Scotland

The uprating “will maintain the real-terms value of the price incentive to use recycled rather than virgin aggregate in construction,” insisted the XST. Meanwhile, clause 100 and schedule 23 adjust aggregates levy legislation to reflect the introduction of the new Scottish aggregates tax and ensure appropriate exemptions and credits for materials between Scotland and the rest of the UK.

Amendments 26 to 28 are needed to ensure that the legislation interacts correctly with Scottish Government legislation so that a credit from aggregates levy is available on aggregates moved to Scotland only in circumstances in which Scottish aggregates tax is payable on the movement, he explained. Additionally the government have tabled a ‘motion to transfer’, a minor amendment to correct the placement of schedule 23 in the Bill, so it appears after schedule 13, following the order of the clauses introducing the schedules.

The Shadow XST spoke to new clause 23 which aimed to require the government to assess the impact of clause 99 on the construction industry and key national infrastructure products.

Joshua Reynolds, for the Lib Dems, observed that the uprating “will add about £3.2 million to the bill for HS2, which we know is already significantly over budget.”

Clause 99, clause 100 and schedule 23 – passed.

New clauses are decided upon at the end of the committee stage.

Plastic packaging tax (clauses 101-104)

Clause 101: Rate of plastic packaging tax
Clause 102: Chemical recycling: mass balance approach
Clause 103: Pre-consumer plastic
Clause 104: Sections 102 and 103: commencement

The XST said the clauses aim to enhance the effectiveness of the plastic packaging tax by encouraging greater use of recycled plastic and recognising innovative recycling technologies. He said the tax encourages creation of demand for recycled material and supports broader environmental goals, and that the clauses implement the tax “in the right and proportionate way.”

On Clause 102, the Shadow XST welcomed the ‘mass balance’ approach for chemically recycled plastic but highlighted potential certification and compliance burdens for smaller businesses. On Clause 103, the exclusion of pre-consumer plastics from recycled content definitions was discussed, with questions around how this might shift tax liabilities.

The Exchequer Secretary responded that the mass balance approach is already accepted in other sectors such as cocoa and timber. “Respondents to the consultation on a mass balance approach agreed that combining it with third-party certification is the best approach to prevent fraud and abuse,” he added.

Clauses 101 to 104 – passed.

Rates of soft drinks industry levy (clause 105)

The Shadow XST criticised the cumulative CPI-based increase as effectively a retrospective tax rise. “Imposing, in one go, six years of inflation over a period when it was not imposed represents a 27% retrospective increase… something that I think is without precedent in recent UK fiscal policy,” he said.

The XST defended the government’s approach, stating that uprating in line with inflation protects the real-terms value of the SDIL and maintains incentives for reformulation.

Clause 105 – passed.

Amendment of customs tariff power (clause 106)

The XST told MPs that clauses 106 to 108 strengthen the UK’s trade defence toolkit, making it more closely aligned to that of international peers. “The changes made by [this] clause will put beyond doubt that we are able to apply tariffs on a global basis or against a group of countries, where consistent with international agreements to which the UK is a party,” he added.

Clause 106 – passed.

Customs duties (investigations) (clauses 107-108 plus opposition amendments 44-45)

Clause 107: Dumping and subsidisation investigations
Clause 108: Safeguarding investigations

Clause 107 gives the Secretary of State the power to direct the Trade Remedies Authority (TRA) to initiate a dumping or subsidisation investigation.

Lib Dem spokesperson Joshua Reynolds proposed two amendments to “strengthen the democratic accountability in our trade remedies system”. Amendment 44 would, he said, require the Secretary of State to lay before Parliament a full statement before directing an investigation. “That statement must set out the evidence, assess the impact on consumer pricing and supply chains and explain why ministerial direction is necessary.” Amendment 45 would require the TRA to assess and publish its impact on consumers and businesses using imported inputs before recommending duty levels and would require ministers to consider this assessment when making their final decisions.

The Shadow Economic Secretary was supportive of the clauses and the Lib Dem amendments, but observed that absence of any parameters or threshold that would distinguish a legitimate increase in quantity of goods from an increase that warrants investigation gives the government a lot of discretion.

Division: Amendment 44 was rejected by 9 votes to 5. Amendment 45 was not moved.

Clauses 107 and 108 – passed.

Customs facilities at approved wharves and other places (clause 109)

The XST told MPs that clause 109 would require the small number of ports assessed as having insufficient space on site for customs infrastructure to provide equivalent infrastructure at an offsite location, which must be approved by HMRC. Additionally, all ports will now be responsible for providing and funding the customs infrastructure required for border checks on goods.

The Shadow Economic Secretary supported the principle of the clause, but expressed concern about whether there would be any adverse knock-on effects on trade through the ports.

Clause 109 – passed.

Rates of economic crime (anti-money laundering) levy (clause 110 plus government amendment 12)

The economic crime levy raises money from industries at the highest risk of being abused for money laundering. This clause increases the revenue raised each year by the levy by £110 million from 2027-28 onwards. The changes have been designed “with proportionality and fairness at their core”, said the XST, adding that no business will pay more than 0.1% of its UK annual revenue in levy charges.

Government amendment 12 seeks to update the language in the Economic Crime and Corporate Transparency Act 2023, the minister explained. Current band names “large” and “very large” will change to new band names A, B, C and D.

The Shadow Economic Secretary expressed support for the levy but was alarmed that a business with £500 million to £1 billion revenue would see a 1,289% increase in its bill, seeing a rise from £36,000 to half a million pounds.

Clause 110 – passed. Government amendment 12 – passed.

Annual Tax on Enveloped Dwellings (Clause 111)

Clause 111: Removal of time limit to claim relief under section 106(3) of FA 2013

“HMRC is currently applying its discretion to accept late claims pending enactment of this legislative change,” said the XST. “The change is necessary to ensure that the law reflects our policy aims for relief from the ATED.”

The Shadow Economic Secretary was concerned about the prospect of late claims potentially requiring HMRC to revisit historical ATED returns long after they were filed. “Given service levels in HMRC are already stretched, it is unclear why the government have chosen to do that,” he said. The minister told him that, yes, HMRC has assessed the implications of the change.

Clause 111 – passed.

Public bill committee will resume on Tuesday 2 February at the start of Part 4 of the Bill, Vaping Products Duty.