Asked by: Lord Bailey of Paddington (Conservative - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government whether they will consider reducing National Insurance thresholds for employers.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
The Government has taken a number of difficult but necessary decisions on tax, welfare, and spending to fix the public finances, fund public services, and restore economic stability after the situation we inherited from the previous government.
One of the toughest decisions we made was to raise the rate of employer National Insurance Contributions (NICs) from 13.8% to 15%, whilst reducing the per-employee threshold at which employers start to pay National Insurance (the Secondary Threshold) from £9,100 to £5,000.
The Government recognises the need to protect the smallest businesses and charities, which is why we have more than doubled the Employment Allowance to £10,500, meaning more than half of businesses with NICs liabilities either gain or see no change this year.
Asked by: Lord Bailey of Paddington (Conservative - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government whether they plan to reduce value added tax for hospitality and night-time venues to boost recovery, encourage investment and support long-term growth.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
The Government recognises the significant contribution made by hospitality businesses to economic growth and social life in the UK.
VAT is the UK’s third largest tax, forecast to raise £180 billion in 2025/26. Tax breaks reduce the revenue available for vital public services and must represent value for money for the taxpayer.
HMRC estimate that the cost of a 5 per cent reduced rate for accommodation, hospitality and tourist attractions would be around £13 billion this financial year. If the scope were also to include alcoholic beverages, the cost would be approximately £3 billion greater.
The Government keeps all taxes under review, and the Chancellor makes decisions on tax changes at the Budget, in the context of the overall public finances.
Asked by: Lord Bailey of Paddington (Conservative - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government whether they plan to extend the business rates relief scheme for the night-time economy sector; and what steps they are taking towards business rates reform for that sector.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
To deliver our manifesto pledge, from 2026/27, we intend to introduce permanently lower business rates multipliers for retail, hospitality, and leisure (RHL) properties with rateable values below £500,000, which will include many properties used by the night-time economy sector. This permanent tax cut will ensure that they benefit from much-needed certainty and support.
Ahead of the new multipliers coming into force, we recognise that businesses will need support in 2025/26. As such, we have extended the RHL business rates relief for one year at 40 per cent up to a cash cap of £110,000 per business. Under the previous Government, RHL relief was due to end entirely in April 2025.
Eligibility for the new RHL multipliers is intended to broadly reflect the scope of the existing RHL relief scheme and will be set out in legislation later this year. Eligibility for the RHL relief scheme is set out in guidance published by the Ministry of Housing, Communities & Local Government and includes many night-time economy businesses.
Asked by: Lord Bailey of Paddington (Conservative - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what assessment they have made of the merits of reintroducing VAT-free shopping for overseas visitors.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
The Government has no plans to introduce a new tax-free shopping scheme in Great Britain. Visitors to Great Britain can continue to claim VAT relief where the items purchased are shipped directly to their home country as exports.
In March 2024, the Office for Budget Responsibility (OBR) conducted a review of the previous Government’s 2020 costing of removing tax-free shopping. The OBR’s updated estimate is that the withdrawal of the VAT Retail Export Scheme will save the Exchequer around £540 million per year by 2025-26. Reintroducing tax-free shopping would therefore likely come at significant cost to the Exchequer.
The Government has also noted recent ONS data, which shows that tourism numbers and spending for the UK has recovered at a similar rate following the pandemic to other European economies that offer tax-free shopping.
Asked by: Lord Bailey of Paddington (Conservative - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what steps they are taking to require lenders to consider rental payment history when making decisions on mortgage applications.
Answered by Lord Livermore - Financial Secretary (HM Treasury)
The UK benefits from a competitive mortgage market, including products that are based on a tenant’s history of rental payments. Any prospective first-time buyer should speak to a mortgage broker, who will be able to assist them in finding the best possible product for their circumstances.
The pricing and availability of mortgages is a commercial decision for lenders in which the Government does not intervene. Lenders need to balance the risk of default and losses when making their decisions, which is why mortgage affordability assessments consider a range of factors.