Asked by: Alec Shelbrooke (Conservative - Wetherby and Easingwold)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if she will review the scope of the Plastics Packaging Tax to exempt EN 13432–certified compostable materials; and what assessment has been made of the potential impact of including compostable materials within the tax on growth and innovation in the biodegradable and biobased materials industry and on the delivery of the UK’s circular economy objectives.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
The Government keeps all taxes under review as part of the policymaking process. The Plastic Packaging Tax provides a price incentive for businesses to use recycled plastic in the manufacture of plastic packaging.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government how they intend to ensure consumer protection and regulatory compliance in blockchain and AI-enabled tokenised deposit models in the home-buying and mortgage markets.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
The Financial Conduct Authority is responsible for the regulation of the mortgage market. All FCA-authorised firms are required to comply with the Consumer Duty, which sets high standards of consumer protections and requires firms to put their customers’ needs first.
The Ministry of Housing, Communities and Local Government is currently consulting on reforms to the home buying and selling process. The Government has made clear its objectives that reform should support faster, more reliable transactions and reduced fall throughs and risks.
Asked by: Shaun Davies (Labour - Telford)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment she has made of the potential for AI and digital technology to reduce a) tax evasion and b) tax avoidance.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
HMRC is expanding its use of AI to help tackle the tax gap and The Hon gentleman’s Telford constituency is an important hub for HMRC’s digital and AI work. HMRC’s expansion includes how they focus their compliance work through new risk-targeting capabilities to identify cases for investigation, improving case selection. It also means using AI to identify nascent issues with the tax system, so they can act rapidly to prevent them before they grow.
This year, HMRC has also significantly invested in partnering with the private sector to explore the use of novel analytical techniques and data to identify deliberate evasion.
HMRC is harnessing artificial intelligence to deliver a more efficient and professional service for customers. They will use new technology as a tool to help them to do their jobs more effectively. Greater use of AI will mean that staff spend less time on admin and more time helping taxpayers. It will also help HMRC better target their action against fraud and evasion, to bring in more money for public services.
Artificial intelligence supports some of their processes but never replaces human decision-making and oversight. HMRC remains committed to the safe use of these technologies, underpinned by strict data protection, security and ethical standards. In cases where AI is used in a way that could impact customer outcomes, HMRC ensures that results are explainable and that there is always human oversight. This means that even when AI is used to support decision-making, final decisions are always made by experienced, trained case workers.
Asked by: Lord Wigley (Plaid Cymru - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what plans they have to liquidate Russian assets currently frozen in the UK; and whether they have discussed the implications of that action with (1) leaders of the EU, and (2) President Trump.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
The Chancellor is actively engaging with our EU and G7 partners to explore options for using the full value of Russian sovereign assets immobilised across the G7, in line with international law.
The Government remains committed to ensuring Russia is held accountable for the damage it has caused, and continues to cause, in Ukraine. Alongside our G7 partners, the UK has pledged to maintain the sanctions in Russia’s sovereign assets within our jurisdiction until Russia has paid compensation to Ukraine.
Asked by: Ruth Jones (Labour - Newport West and Islwyn)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what discussions she has had with the Motability Foundation on the the potential impact of her Department's changes to (a) VAT and (b) Insurance Premium Tax for the Motability Foundation on (i) funding for the Mobility Foundation and (ii) the ability of the Foundation to cross-subsidise its work to support the most vulnerable residents.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
Prior to announcing tax changes to the Motability Scheme at Budget 2025, the Government engaged with the Motability Foundation to understand how tax changes would impact the Motability Scheme and their customers.
For customers who cannot afford essential costs or need more complex adaptations, the Motability Foundation will continue to provide means-tested grants to those most in need of financial help. In 2024/25, these grants totalled £59.3 million, supporting over 10,000 customers.
Asked by: Andrew Mitchell (Conservative - Sutton Coldfield)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, pursuant to the Answer of 16 December 2025 to Question 97744 on Council Tax: Sutton Coldfield, if she will publish the evidential basis for the claim that the surcharge will raise £400m in revenue in 2028/29.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
The policy costing note for the High Value Council Tax Surcharge is available on page 51 of the Budget 2025 policy costings document:
Asked by: James Cleverly (Conservative - Braintree)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, which Valuation Office Agency special category code hereditaments are eligible for the 2026-27 Retail, Hospitality and Leisure multipliers.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
VOA Special Category codes do not determine eligibility for RHL multipliers. Local authorities are responsible for administering the business rates multipliers for qualifying Retail, Hospitality and Leisure properties.
Asked by: James McMurdock (Independent - South Basildon and East Thurrock)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what plans she has to amend inheritance tax legislation to ensure that compensation paid to the estates of deceased victims of the Infected Blood scandal is exempt from inheritance tax.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
At Budget 2025, the government announced that it would extend the existing relief from inheritance tax for compensation payments made from the Infected Blood Compensation Scheme and the Infected Blood Interim Compensation Payment Scheme (‘infected blood compensation payments’). A Tax Information and Impact Note has been published and can be found here: Inheritance Tax and Infected Blood compensation payments - GOV.UK.
Finance Bill 2025-26 contains a power to make changes to the inheritance tax treatment of infected blood compensation schemes in secondary legislation. The government will lay regulations subject to parliamentary approval of the Bill. More information about what this means in practical terms and what action impacted individuals should take ahead of regulations being made were published in this Written Ministerial Statement: Inheritance tax relief for infected blood compensation payments
Asked by: Carla Lockhart (Democratic Unionist Party - Upper Bann)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment she has made of the potential impact in Northern Ireland of the abolition of VAT exemption for private school fees on the parents of children with special educational needs; and what estimate she has made of additional VAT receipts arising in Northern Ireland.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
The Government conducted thorough and detailed analysis of the impacts of this policy, including in Northern Ireland, and published a Tax Impact and Information Note (TIIN) which sets out this analysis. This is a comprehensive assessment of the impacts on individuals and families, businesses and the wider economy, as well as equalities impacts. It was published online and can be found here:
www.gov.uk/government/publications/vat-on-private-school-fees/ac8c20ce-4824-462d-b206-26a567724643
In Northern Ireland, the Education Authority (EA) is responsible for funding placements of pupils with a statement of special educational needs (SEN) within a private school. The EA can recover the VAT that it is charged on these pupils’ fees, which means that those pupils are unaffected by the removal of the VAT exemption.
Due to how VAT is collected it is not possible to estimate the VAT receipts arising in Northern Ireland. However, overall this policy is expected to raise £1.7 billion per year by 2029/30.
Asked by: Tanmanjeet Singh Dhesi (Labour - Slough)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether her Department is taking steps to support self-employed people who require support to file their tax returns due to economic or health difficulties; and whether she has made a recent assessment of the potential merits of reforming the penalty system, in particular for those who do not owe any tax.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
The government has reformed penalties and at Budget 2025 confirmed the introduction of a new penalty regime for late filing of SA returns and late payment of income tax that will now apply to all SA customers from April 2027. This reform of late filing penalties will reduce the penalties a customer can accumulate for filing late and will introduce a further safeguard so people will not receive a financial penalty for a single failure to file on time.
HMRC also has dedicated support in place for those facing personal difficulties and encourages anyone struggling to meet their obligations to make contact as soon as possible by phone or online.
This includes:
The tax system contains obligations, set out in law, to ensure that HMRC can collect the correct tax to fund vital public services. HMRC is bound by law to apply penalties where customers do not meet these obligations. Penalties also help to reassure customers who comply with their obligations that HMRC are applying the rules fairly and consistently.
Under Self Assessment (SA), HMRC requires information from customers in their tax returns to determine whether they have any liability to income tax. Even where a customer has no tax to pay, the information provided within their SA return ensures that taxpayers receive the benefits to which they are entitled, such as Tax-Free Childcare.
Where HMRC charges a penalty, a customer can formally appeal. HMRC will cancel any penalties where they accept that a taxpayer had a reasonable excuse for not filing their return on time.