LIVEBLOG: Finance Bill (No.3) 2018 - Public Bill Committee 9th sitting

MPs on the Finance (No.3) Bill public bill committee debated and agreed the final clauses (clauses 79-92) of the Bill on the morning of Tuesday 11 December. This included consideration of clauses 79 and 80 (offshore time limits).

You can read the amendments tabled for debate here. You can listen to the debate here.

Summary

The committee spent two hours (9.25-11.29) debating and approving parts 3 and 4 of the Bill The longest debate was on clauses 79-80, where a number of concerns from the CIOT's Low Incomes Tax Reform Group about the impact of the clauses were particularly prominent, and the subject of a number of amendments tabled by the opposition. Issues included retrospectivity, taxpayer safeguards and de minimis levels. The committee also spent time debating voluntary returns (clause 86) and interest charged and paid by HMRC (clause 87). The bill as amended (one minor government amendment) was agreed and sent back to the Commons where it will face its report stage on a date yet to be announced (which may be next week or may not be until the new year).

Time limits for assessments etc      

Clause 79 - Offshore matters or transfers: income tax and capital gains tax
Clause 80 - Offshore matters or transfers: inheritance tax 

Clauses 79 and 80 are grouped together.

Clause 79 increases the assessment time limits for offshore income and gains to 12 years unless a longer time limit applies. It applies to income tax and capital gains tax where a tax loss arises in respect of offshore tax. 

Amendment 105 (SNP) would delete paragraph (b) of section 36A(7), which is being inserted into the Taxes Management Act 1970.
Amendment 106 and 107 (SNP) would mean that new section 36A does not apply retrospectively.
Amendment 139 (Labour) establishes a de minimis threshold for the extended time limits of £50.
Amendment 140 (Labour) requires HMRC to create a public register of those paying tax as a result of the extended time limit.
Amendment 141 (Labour) would require the Chancellor of the Exchequer to review certain characteristics of those affected by the main provisions of Clause 79.
Amendment 142 (Labour) would require the Chancellor of the Exchequer to review the revenue effects of the main provisions of Clause 79 in respect of each tax year.
Amendment 143 (Labour) would require the Chancellor of the Exchequer to review the effects of the main provisions of Clause 79 on incentives to comply with tax rules.

Clause 80 increases the time limit for proceedings for the recovery of inheritance tax (IHT) to 12 years in cases where a tax loss arises in respect of offshore tax unless a longer time limit applies. 
Amendment 144 (Labour) would require the Chancellor of the Exchequer to review certain characteristics of those affected by the main provisions of Clause 80. 
Amendment 145 (Labour) would require the Chancellor of the Exchequer to review certain characteristics of those affected by the main provisions of Clause 80.

Kirsty Blackman (SNP) was called to move amendment 105. She said she had put amendments 105, 106 and 107 forward as a result of representations received from the Chartered Institute of Taxation and its Low Incomes Tax Reform Group. Amendment 105 is prompted by concern that there does not appear to be anything which prevents HMRC from relying on sub-paragraph 7(b) to claim that, for example, owing to internal resource constraints they were unable to make the assessment within the normal time limits, which is the argument being used for the introduction of ETL in the first place. This could render the safeguard provided in sub-paragraph (7)(a) ineffective. If sub-paragraph 7(b) is to be retained, LITRG recommend that what is ‘reasonable’ be defined clearly, preferably with changes made at report stage. For example, we consider that it is reasonable for HMRC to make any assessment within 30 days of receiving the relevant information and no later, rather than effectively a variable time period depending potentially on the size and complexity of the data set received. In summary this amendment would remove what is perceived to be an unnecessary provision.

Amendments 106 and 107 would ensure the measure did not apply retrospectively. Again, LITRG fail to see how the Government can claim that the rules do not have retrospective impact where sub-paragraph (5) of the Clause makes it clear that the amendments apply to 2015/16 and subsequent years (or 2013/14 in the case where the loss of tax has been brought about carelessly). The original consultation stated, in paragraph 4.13, that ‘the new legislation will not apply retrospectively’, so to effect the legislation as intended sub-paragraph (5) should be amended such that the rules only apply for tax years 2019/20 onwards only.

They also want HMRC to consider carefully the language used in taxpayer communications so as to minimise distress caused to the taxpayer. At a minimum, HMRC should provide taxpayers with guidance on any reliefs which may be applicable to offset any potential liability and avoid at all costs language which is not appropriate for a taxpayer who conducts their affairs in good faith.

Ms Blackman challenged the government's assertions that it had carried out adequate consultation on this issue. She asked the government to provide reassurances to her, in which case she would withdraw her amendments. 

Anneliese Dodds (Labour) said she agreed with many or Kirsty Blackman's comments. In relation to vulnerable taxpayers being affected, she said Labour's amendment 139 seeks to establish a de minimis threshold for the extended time limits of £50. That follows the advice of LITRG and CIOT, she said, who "raised a number of concerns about this clause. LITRG said they remain deeply concerned about the impact of these changes on low income, unrepresented taxpayers, and our amendment tries to restore some sense of balance to the procedures set out in this clause." She noted the serious restrictions on amendments prevent wholesale reform of the process, but this modest change would improve things.

Ms Dodds continued: "LITRG suggests that in order to reduce the impact of the measure, the Government should introduce a de minimis threshold for the extended time limits to apply. For example, the approach taken by HMRC in assessing trivial amounts under the Worldwide Disclosure Facility, e.g. where the net amount due after applicable reliefs is no more than £50, may be suitable. So why might this de minimis threshold be necessary? LITRG points to the fact that these changes often only affect people who have acted non-deliberately so this measure would blur the distinction between people who have taken reasonable care and those who haven't, and it poiints to the great deal of unnecessary stress that threatening letters from HMRC can cause, especially for vulnerable people who might not understand why they might have been contacted by HMRC. So surely it would be sensible for HMRC's resources to be focused on trying to deal with large scale tax evasion rather than those, especially older people who might have accidentally failed to pay a very small amount of tax, so I hope that the minister will consider accepting this amendment in the spirit in which it is intended which is as a genuine improvement to help vulnerable people."

She outlined some of Labour's other amendments (see list above). She said she was trying to get a sense of who these measures were really focused on.

Turning again to LITRG's briefing on these clauses, she said it contained some interesting information in relation to these points. "They say: 'Many people assume that ‘offshore’ tax matters relate only to the wealthy. However, 24% of daily enquiries to the charity Tax Help for Older People in September of this year were related to the Worldwide Disclosure Facility. The average age of the callers was 76 and they had small amounts of foreign bank interests and/or pensions.' They say: 'in their experience and from insight garnered from THOP, the vast majority of taxpayers who have undisclosed liabilities related to offshore investments will want to be compliant upon simply being made aware of the error'. And they also make the point about accessibility for non-native English speakers, saying: 'Migrants, whose first language is unlikely to be English and who may therefore struggle to navigate the complex rules on the taxation of offshore income and gains, are another group likely to be affected because they are more likely to have offshore investments prior to their arrival in the UK.'" She said the measures were significant because they change the conventions around how long taxpayers are anticipating they would need to save information around their tax affairs. 'The measure adds complexity to the question of taxpayer certainty on when a tax year is ‘closed’ and impacts on a taxpayer’s record-keeping obligations – effectively requiring people to keep records for 12 years just in case they need to make a disclosure to HMRC. This is well beyond the current statutory time limit for keeping records.' I think most of us would assume that seven years is the normal period during which one would ensure to keep those records and that is obviously a very significant extension." She criticised the government for not looking adequately at the impact of the measure.

Ms Dodds said amendment 143 was designed to provide an understanding of these measures in terms of incentives to comply with tax rules. "Once again the issue with these changes was made eloquently by LITRG. They say that: 'proposals erode a general feature of the current law that the circumstances leading to the error determine the length of time which HMRC have in order to raise a discovery assessment. The incentive to take reasonable care is therefore reduced under the proposals, because an individual will have the same time limit applicable when they make a non-deliberate error, whether or not that error is careless.' So it seems that according to the experts these changes make it less likely that HMRC will collect its full due of tax, instead creating a series of incentives for not complying." She asked for the minister's comments on LITRG's assessment.

She observed that the measures in clauses 79 and 80 apply to income tax, capital gains tax and inheritance tax, but not to corporation tax. The measures were expected to raise just £15 million a year. She said it was 'peculiar' because there was a commitment in the consultation document (which she quoted from) to apply the extended time limit to CT too depending on the results of the consultation. Not applying it to CT led to anomalies, she said. HMRC would have up to 12 years to investigate the affairs of small, unincorporated businesses involved in offshore transactions, but only four years where the businesses are incorporated. Why did government reject a longer assessment for CT? It appeared to relate to the complexity of large companies, but surely having extra time to investigate large companies with complex structures would be appropriate, she suggested. She suggested these measures were a trap for the poorly advised while they could be dodged by multinationals and the wealthy who can use incorporation to get round it.

The Financial Secretary to the Treasury, Mel Stride, responded. Responding to Kirsty Blackman on retrospectivity he said the law officers have confirmed to him "there is nothing retrospective about the measures in this clause and it is the case that no investigation that has been closed, for example, will be reopened as a consequence of the measures here. And indeed, at the point at which the measures come into effect, no-one who is currently, or would be at that time, out of scope of these changes will be brought into scope of the changes." On consultation he said the government had consulted in spring last year. On a de minimis amount, suggested by LITRG, he said he could inform her that it was not true that the government was not securing significant amounts from the most wealthy, both individuals and corporations. (He did not explain at this point why the government were opposed to a de minimis level - though he did later on in his remarks (see below).) On why corporation tax is not included he said responses to the consultation had not supported this and had raised practical and legal issues, eg the rules which identify offshore issues were not designed for corporates and would result in a wide range of genuine commercial transactions being caught. He also told the committee that of the largest 210 businesses in the UK at any given time half of them are under investigation. That doesn't mean they are doing anything wrong but it does show HMRC are active in ensuring compliance by the largest businesses.

Kirsty Blackman intervened to express concern that the minister's definition of retrospectivity was different to LITRG's. She asked if he would write to her with his definition of retrospectivity ahead of report stage. The minister said he would be happy to do that.

The minister said the changes introduced by clauses 79 and 80 would ensure that HMRC are able to deal with offshore cases effectively where the facts are often difficult to establish. The new extended time limits would not allow HMRC to assess any tax that cannot be assessed under current rules at the time the legislation comes into force. "The new time limits will not apply where HMRC has received information in accordance with certain international agreements with other tax authorities on the basis that it is reasonable to expect an assessment to be made within the existing time limit."

Turning to amendment 105, he said the amendment "unbalances the safeguards which ensure that the new time limits would only apply if HMRC already have information to make an assessment or could reasonably be making an assessment within current time limits. If this amendment is accepted then HMRC could receive information on a tax compliance case which it would be unable to act upon. For example, if information arrived from overseas immediately before the end of the current time limit HMRC would be timed out to collect the lost tax. This could incentivise slow responses from overseas intermediaries when partner jurisdictions gather information in response to HMRC written requests."

Turning to amendments 106 and 107 which change the years from which clause 79 would have effect. "This amendment would water down the government's commitment to tackle offshore non-compliance now. It would delay the additional time this measure gives to HMRC for at least a further four years, so the time limits would only begin to extend from tax year 23-24. The government is clear that this measure should start helping HMRC's compliance work as soon as possible."

On amendment 139 on a de minimis level he said it was right that once HMRC had calculated tax due they were able to collect it regardless of the amount. It would also be fundamentally unfair if a de minimis level applied to offshore cases but not onshore cases. Anneliese Dodds intervened to ask if there was a 12 year time limit for onshore cases for individuals. The minister responded there was not. Ms Dodds came in again to note that the minister had said it would be unfair if an anomaly was created to treatment of onshore and offshore non-compliance but the government was just creating such an anomaly. The minister said the whole crux of what the government was doing rested on the belief that offshore transactions are less transparent and often more complicated and that lies at the heart of why there should be a longer period for offshore entities. Ms Dodds said that if government was - in the future - looking to extend the period for onshore investigations they might want to introduce a de minimis level there. The minister said, perhaps a little ambiguously, that 'in another world', if that happened, we might 'come to' her proposal.

On Labour's requests for reviews he said they would not have the intended effects. It was very unlikely that full assessment of any relevant cases would be conducted within six months of Royal Assent.

Kirsty Blackman spoke briefly again at the end of the debate on these clauses, saying that if the minister wrote to her on retrospectivity she would not press her amendments to the vote.

Anneliese Dodds thanked the minister for his remarks but said she remained concerned about treatment, potentially, of elderly taxpayers etc so they would push two of their amendments to the vote.

Amendment 105 was withdrawn.

Amendment 139 (Labour - establishing a de minimis threshold for the extended time limits of £50) was pressed to the vote and defeated 10-9.

Amendment 142 (Labour - requiring the Chancellor to review the revenue effects of the main provisions of Clause 79 in respect of each tax year) was pressed to the vote and defeated 10-9.

Clauses 79 and 80 were agreed without opposition.

Security deposits      

Clause 81 - Construction industry scheme and corporation tax etc

Clause 81 provides HMRC with powers to make secondary legislation to require a person to provide a security for corporation tax liabilities and construction industry scheme deductions that are or may be due to HMRC. It also provides that failure to provide security when required will be a summary offence and a person who has committed that offence will be subject to a fine. 

Amendment 146 (Labour) would require the Revenue and Customs Commissioners to issue guidance on how it is determined that security is necessary for the protection of the revenue.
Amendment 147 (Labour) would require the Revenue and Customs Commissioners to issue guidance on how it is determined that security is necessary for the protection of the revenue.
Amendment 148 (Labour) would require the Chancellor of the Exchequer to review the effects of the provisions of Clause 81 on the construction industry.

Anneliese Dodds, for Labour, spoke first. She said the changes merited further scrutiny. She asked the minister to clarify the guidance that would be provided. We need to understand how these powers will be targeted and using which criteria, she said. She noted that the TIIN had identified substantial additional costs for HMRC to implement these measures.

The FST replied, saying that securities could be very effective in changing behaviours and protecting future revenues. Extending securities to corporation tax and the construction industry scheme's deductions would close the gap in the current regime. The changes made in clause 81 would only affect the minority of businesses determined not to pay rather than those who can't pay. It would cover those involved in phoenixism and contrived liquidations. He said HMRC's guidance on securities is published online and would be updated before this measure is introduced.

Anneliese Dodds withdrew her amendments. The clause was agreed without opposition. 

International agreements      

Clause 82 - Resolution of double taxation disputes

Clause 82 introduces statutory powers to implement the EU directive on tax dispute resolution mechanisms in the EU and other similar international agreements. Article 22 of the Directive requires Member States to bring into force the laws, regulations and administrative provisions necessary to comply with the Directive by 30 June 2019 at the latest. The Directive is designed to complement and strengthen rather than supplant existing dispute resolution mechanisms.

Amendments 137 and 138 (both SNP) provide for all regulations under the new power to be subject to the affirmative procedure.
Amendment 149 (Labour) would review the impact of the main powers under clause 82 in the event the UK leaves the EU under (a) no deal or (b) a withdrawal agreement.
Amendment 150 (Labour) would require any regulations to be accompanied by a statement on expected revenue effects.

Kirsty Blackman (SNP) spoke first on this clause. She said the last 24 hours had highlighted where we had got to on EU withdrawal so it was important we could see what the impact of 'no deal' would be on relevant measures before Parliament. SNP would support Labour;s amendments 149 and 150. On amendments 137 and 138 she said Parliament was being asked to grant the government additional powers. It was important there was proper scrutiny of these powers.

Anneliese Dodds (Labour) said it was highly sensible to require regulations to be subject to the affirmative procedure and Labour would support the SNP in a vote on their amendments. Labour's amendments responded to a lack of information about the impact of the powers under the clause. It was part of a general lack of information about the government's future relationship on tax matters with the EU, eg. she had received no indication whether the government would seek to remain part of the 'code of conduct group'.

Sir Robert Syms (Conservative backbencher) said the opposition had the power to force regulations subject to the negative procedure to debate and vote. Kirsty Blackman said she was on the sifting committee and the government didn't always get classifications right. 

The FST responded to the debate. He said the measure was necessary to allow implementation of the EU directive. The amendments to apply draft affirmative procedure were inappropriate as the regulations would be a 'technical exercise'. Also, regulations can of course be prayed against.

Anneliese Dodds asked the minister to ensure very clear linkage was provided on the webpages relating to the Finance Bill to the relevant TIINs. She also felt that approval of the UK's tax treaties was not subject to sufficient scrutiny. "To suggest that our existing system for some of these matters is failsafe is incorrect," she said. The FST said he would be happy to look into the TIINs matter.

MPs voted on amendment 137 (SNP - providing for regulations under the new power to be subject to the affirmative procedure) but it was defeated 10-9.

Clause 82 was agreed without opposition.

Payment of unlawful advance corporation tax      

Clause 84 - Interest in respect of unlawful ACT
Clause 85 - Section 84: supplementary 

Clauses 84 and 85 were grouped together. Clause 84 together with clause 85 provides a new non-exclusive interest like remedy in relation to certain claims against HMRC and its predecessor the Inland Revenue in respect of advance corporation tax (ACT) that was paid and subsequently set off or repaid before the time of the claim. The clause will apply with effect from Royal Assent, in relation to claims made before 12 December 2012. Clauses 84 and 85 address uncertainty that has arisen for both taxpayers and HMRC following the recent Supreme Court decision in Prudential Assurance Company Ltd v Commissioners for Her Majesty’s Revenue and Customs 2018 UKSC 39. 

Amendment 151 (Labour) would require the Chancellor of the Exchequer to review the effectiveness of the new statutory remedy one year after its adoption into law.
Amendment 152 (Labour) would require the Chancellor of the Exchequer to review the impact of the new statutory remedy on corporation tax receipts.

Jonathan Reynolds, for Labour, moved amendment 151. He said the amounts at stake here were significant - £4-5 billion according to media reports. It is essential we have a clear understanding of whether this provisions will give rise to any changes in revenue collection.

The FST replied, saying, in response to a question from Mr Reynolds, that he was not aware of any other issues relating to ACT. It would be potentially unhelpful to comment on the effectiveness of the statutory remedy when litigation may still be ongoing, he told the committee. 

Amendment 151 was withdrawn. The clauses were agreed without opposition.

Voluntary returns      

Clause 86 - Voluntary returns

Clause 86 introduces a new power for HMRC to treat tax returns that have been made on a voluntary basis in the same way as tax returns delivered under statutory notice. This applies to voluntary tax returns from individuals, partnerships, trustees and companies. The clause will come into effect at Royal Assent of the Finance Bill. It will apply retrospectively to any voluntary return, whenever made. It will also have prospective effect.

Amendment 153 (Labour) would require the Chancellor of the Exchequer to review (within one year) the effectiveness of the provision for voluntary tax returns.
Amendment 154 (Labour) would require the Chancellor of the Exchequer to review (within 6 months) the effectiveness of the provision for voluntary tax returns.
Amendment 155 (Labour) would require the Chancellor of the Exchequer to review the HMRC resourcing needed for the provision for voluntary tax returns.

Jonathan Reynolds (Labour) noted that HMRC had said that they expected that simple assessment would significantly reduce the number of voluntary returns; HMRC have also stated that long term they plan to abolish the annual tax return as part of Making Tax Digital (MTD). He observed in passing that MTD would bring in a significant reporting burden. He noted that four million calls to HMRC went unanswered last year. This change to legislation seemed sensible he said, however we need further insight into how HMRC resources might be affected.

The FST told the committee that there would be no change in practice or revenue from the clause, so it ould have no impact on HMRC resources.

Amendment 153 was voted on, being rejected 10-9.

Amendment 154 was voted on, being rejected 10-9.

Amendment 155 was voted on, being rejected 10-9.

Clause 86 was agreed without opposition.

Interest      

Clause 87 - Interest under section 178 of FA 1989 and section 101 of FA 2009

Ensures that certain interest rate provisions are implemented correctly.  It allows HMRC to charge late payment interest and pay repayment interest and calculate Diverted Profits Tax correctly.  Also ensures that interest provisions in relation to certain penalties regarding PAYE are implemented correctly. It has retrospective effect where necessary. Three new clauses were debated with this clause.

New clause 15 (Labour) would require the Chancellor of the Exchequer to review the viability of increasing interest rates on the late payment of penalties for the promoters of tax avoidance schemes to 6.1%.
New clause 16 (Labour) would require the Chancellor of the Exchequer to review the interest rate on late payment of penalties for the promoters of tax avoidance schemes.
New clause 17 (Labour) would require the Chancellor of the Exchequer to review the viability of equalising HMRC’s late payment interest rate and the repayment interest rate.

The FST said the clause aimed to clarify legislative provisions in relation to interest charged by HMRC across several tax regimes. Regarding new clauses 15 and 16 he said these were not necessary. Interest is charged on late payment in the same way as it is charged on other overdue payment to HMRC. It is not affected by what the penalty is for. The penalty is designed to be punitive, interest is designed to give commercial restitution. It is linked to the Bank of England base rate. New clause 17 - government rules are in line with commercial practice, a high rate of  repayment interest will overcompensate those paid the wrong amount. The difference encourages people to pay the right amount at the right time to HMRC.

Jonathan Reynolds (Labour) noted the charging of interest was an important tool in deterring late payments. He noted the minister had promsied to lay before the House a report setting out the impact of DPT on revenue. The opposition looked forward to seeing that. He asked if the minister could provide further clarity around changes in relation to PAYE - could he elaborate on what consultation is taking place with low income taxpayer groups on this measure? He noted the retrospectivity of the 2019 loan charge, saying the utmost caution should be observed when applying any retrospective rules which apply to indivudals. He was pleased that the legislation allows for interest charging on promoters of tax avoidance. "We must ensure we are pursuing promoters with the full force of the law," he said. 

Mr Reynolds said there was a clear imbalance between a taxpayer paying 3.25% on money owed to HMRC, but HMRC paid just 0.5% on money owed to taxpayers. "There should not be one rule for taxpayers and another for HMRC," he argued.

The FST replied that the clause was just putting beyond doubt what had already been established over a long period. He argued the loan charge was not retrospective - the arrangements were always ineffective. Ms Dodds asked if that meant advisers were promoting illegal schemes at the time. The FST said on many occasions they were promoting ineffective schemes. Ms Dodds pressed him on the point. The FST said the promoters and enablers of those schemes had been subject to various legislation for some years now - penalties of up to £1 million.

Clause 87 was agreed without opposition.

Regulatory capital securities

Clause 88 and schedule 19 - Regulatory capital securities and hybrid capital instruments

This clause and schedule were introduced to ensure that interest payments arising from certain debt instruments with some limited equity features are deductible from the issuer’s taxable profits.   Specifically the schedule provides new tax rules for loan relationships that are hybrid capital instruments.  It also revokes regulations dealing with the taxation of regulatory capital.    

Amendment 156 (Labour) would require the Chancellor of the Exchequer to make a statement on the consultation undertaken on the measures introduced by Schedule 19.
Amendment 157 (Labour) would require the Chancellor of the Exchequer to review the IT costs of implementing the measures in Schedule 19.
Amendment 158 (Labour) would require the Chancellor of the Exchequer to publish a review of the revenue effects of the measures introduced by Schedule 19. 

This is the first clause in part 5 of the Bill (Miscellaneous and final). The FST said the changes related to hybrid capital which sits near the border between debt and equity. The government's aim is to ensure all hybrid capital that is debt is treated as debt, he explained. HMRC would monitor the rules closely to check there is no abuse. Regarding amendment 156 he said the government had to wait until the Bank of England's rules for minimum requirement for eligible liabilities (EMREL) were published by the bank in June 2018. These rules apply from Jan 2019 so these changes were needed by the same date. It had not, therefore, been possible to conduct full consultation in the time available.

Jonathan Reynolds (Labour) asked the minister how confident he feels that HMRC and relevant financial taxpayers will have time to comply with the new rules. The timeline feels extremely tight, he suggested. He also set out Labour's proposed amendments (see above).

The FST replied that the government was confident HMRC and taxpayers would be able to comply in the timescale being adopted.

Amendment 157 was voted on, being rejected 10-9.

Amendment 158 was voted on, being rejected 10-9.

The clause and schedule were agreed without opposition.

Other

91 Interpretation
92 Short title 

Clause 91 provides for the use of abbreviations for a variety of Acts. For example, it provides for the use of “CAA 2001” as an abbreviation for the Capital Allowances Act 2001. 

Clause 92 provides for the bill to be known as “Finance Act 2019” upon Royal Assent.

The clauses were agreed without debate and without opposition.

New clauses

All new clauses are voted on at the end of committee stage proceedings. There may be debate at this stage but where a new clause relates to an earlier clause it will usually have been discussed at that point and will be taken 'formally' (ie with no debate).

New clause 1 had not been selected for debate because it was deemed to invite a repetition of debate in Committee of the whole House .

New clause 2 (SNP) would require the Chancellor of the Exchequer to review the effect of the changes to capital allowances in clauses 29 to 34 and Schedule 12 in each part of the UK and each region of England; must consider effects on business investment, employment, and productivity, and estimate effects of leaving EU with (a) 'no deal', (b) remaining in the single market and customs union, and (c) deal but not remaining in the single market and customs union. This had been debated with clause 34 (see earlier report). MPs voted on it now, defeating it 10-9.

New clause 3 had been withdrawn.

New clause 4 (Labour) requires a review of the effects of Schedule 5, and a comparison of the effects of that Schedule to an increase of the rate of corporation tax to 26%. This had been debated with clause 17 (see earlier report). MPs voted on it now, defeating it 10-9.

New clause 5 (Labour) would require the Chancellor of the Exchequer to review the aggregate effect of the changes to corporation tax and capital allowances made under this Act. It was not pressed to the vote.

New clauses 6 and 7 were judged to be outside the scope of the resolutions for the Bill so were not selected for debate.

New clause 8 (Labour) requires a review of how the provisions in Schedule 16 affect voucher circulation and distribution. This had been debated with clause 51 (see earlier report). It was not pressed to the vote.

New clause 9 (Labour) requires a review of the revenue effects of diverging from EU law on the VAT treatment of vouchers. This had been debated with clause 51 (see earlier report). It was not pressed to the vote.

New clause 10 (Labour) requires a review of the revenue effects of the provisions in clause 43, and for that review to report within one year of that clause becoming effective. This had been debated with clause 43 (see earlier report). It was not pressed to the vote.

New clause 11 (Labour) requires an annual statement on how the provisions in section 43 have impacted the number of back claims of the SDLT higher rate for additional dwellings. This had been debated with clause 43 (see earlier report). It was not pressed to the vote.

New clause 12 (Labour) requires a review on how the provisions in clause 43 have affected house prices, and for that review to report within one year of that clause becoming effective. This had been debated with clause 43 (see earlier report). It was not pressed to the vote.

New clause 13 (Labour) requires the Chancellor of the Exchequer to carry out and publish a review of the effects of Clause 45 on equality in relation to households with different levels of income, people with protected characteristics, the Treasury’s public sector equality duty and on a regional basis. This had been debated with clause 45 (see earlier report). It was not pressed to the vote.

New clause 14 had not been selected for debate because it was inconsistent with the context of the relevant provision.

New clause 15 (Labour) would require the Chancellor of the Exchequer to review the viability of increasing interest rates on the late payment of penalties for the promoters of tax avoidance schemes to 6.1%. This had been debated with clause 87 (see above). It was not pressed to the vote.

New clause 16 (Labour) would require the Chancellor of the Exchequer to review the interest rate on late payment of penalties for the promoters of tax avoidance schemes. This had been debated with clause 87 (see above). MPs voted to defeat this 10-9.

New clause 17 (Labour) would require the Chancellor of the Exchequer to review the viability of equalising HMRC’s late payment interest rate and the repayment interest rate. This had been debated with clause 87 (see above). MPs voted to defeat this 10-9.

In conclusion

The chair then put the question that the Bill as amended (one government amendment) be reported to the House. This was agreed without opposition.

On a point of order FST Mel Stride thanked the chairs, whips, his office and his bill team.

Peter Dowd thanked the chairs, house staff and Hansard.

The committee concluded at 11.29am, leaving ministers and shadow ministers just a few minutes to get to the main Commons chamber for Treasury questions.

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