Greenhouse Gas Emissions: Tax Strategy

Baroness Hayman Excerpts

Tuesday 6th July 2021 Lords Chamber

[Baroness Penn (Con)]

I absolutely agree with my noble friend’s point. That is why, last July, the Government published their 10-year vision for delivering an effective and modern tax system—the tax administration strategy. If any noble Lords want to read that exciting document, it is on GOV.UK. The strategy includes an extension to making tax digital, intended as the first phase of a modern, digital tax service.

[Baroness Hayman (CB)]

My Lords, I declare my interest as co-chair of Peers for the Planet. I welcome the Minister’s remarks about thinking more strategically on tax issues. The recent Climate Change Committee report recommended a net-zero test for every government policy, and the recent Public Accounts Committee report on environmental tax measures suggested that, from the next Budget, Her Majesty’s Treasury should both assess the environmental impact of every tax change considered and publish the expected environmental impact for each tax measure in the Budget. Will the Government accept those two recommendations?

[Baroness Penn (Con)]

My Lords, the Government will respond to the Climate Change Committee’s report by October, as they are obliged to. They have, in fact, already responded to the PAC recommendations. While the Government have taken on a number of those recommendations, they disagreed with that specific one. We recognise the importance of considering the impact of tax on environmental measures and make those assessments where relevant. However, we think that the recommendation may constrain the Government and place undue burdens. For example, in looking at income tax thresholds or national insurance tax rates, those environmental considerations would not be proportionate or relevant.