Stamp Duty Land Tax

Debate between Richard Graham and David Gauke

Thursday 4th December 2014 Commons Chamber

[Mr Gauke]

I am keen that this does not become a Hertfordshire-dominated debate, but let me thank my hon. Friend, who has been tireless in campaigning on this issue. Indeed, she attracted attention to it in an Adjournment debate earlier this year, expressing her views clearly. In particular, she made the case for helping those who want to get on to the housing ladder, and I know that is a big issue in her constituency, as it is in mine, where house prices are above the average. She has made some important points in this area.

[Richard Graham (Gloucester) (Con)]

rose—

[Mr Gauke]

In an attempt not to keep this debate restricted to Hertfordshire MPs, let me give way to my hon. Friend.

[Richard Graham]

I stand to speak on behalf of my constituents of Gloucester, providing the geographical diversity the Minister was seeking, where the average house price is about £165,000—considerably less than the national average of £275,000. So the vast majority of my constituents buying houses will benefit from either a zero rate of SDLT or the 2% rate he has mentioned. Does he agree that it would be helpful if the Treasury were able to provide information to all of us as to what the savings will be for our constituents, based on the average house price?

[Mr Gauke]

My hon. Friend raises an interesting and important point, and we could provide information on the basis of local authorities figures. What I can tell him is that in the Gloucester local authority area—I am not sure whether it is coterminous with his seat—more than 99% of those who pay SDLT will pay less as a consequence of these changes.

It is striking to note the diversity of commentators who have been positive. Estate agents, professional bodies and others have all shown support. The Royal Institution of Chartered Surveyors has called it a “long overdue” reform. The director-general of the Council of Mortgage Lenders said:

“This fundamental reform has been a long time coming...the vast majority of mortgaged transactions will benefit from lower tax as a result of this move.”

The Building Societies Association has welcomed the announcement. It said:

“It will help individuals and families buy their own home, and smooth out the crazy tax jumps buyers have suffered around the top of each band.”

This is a principled reform that exemplifies the Government’s commitment to a fairer and more efficient tax system.

The previous SDLT regime created distortions in the housing market, imposed perverse incentives and made it harder to get on and move up the property ladder, or indeed move down the property ladder for those wishing to downsize. This major and, as some have argued, overdue reform demonstrates that even in the past six months of this Parliament, we are a Government who are continuing to make radical change for the benefit of the British people.

We realise that this is a big change, even for those who will benefit at such a significant moment in their lives. We have ensured that the changes have been properly explained. Her Majesty’s Revenue and Customs has produced full guidance on the Government website, including a calculator that compares the old and the new systems. As of 9 am this morning, that calculator had been used almost 500,000 times, with no significant delays reported, showing the level of interest in this reform among the public. Critically, HMRC’s specialist call centre was manned until midnight last night when the changes took effect, and is open now. HMRC specialists responded to around 250 inquiries by telephone and all but 3% were resolved immediately, and the remaining handful are being followed up.

Annuities for Pensioners

Debate between Richard Graham and David Gauke

Tuesday 7th January 2014 Westminster Hall

[Mr Gauke]

I suspect that my hon. Friend will not be surprised to learn that I am not inclined to be drawn into specifying what I believe is a reasonable charge for an annuity. What I will say to him—I will expand on this in a moment—is that we want to ensure that the annuities market works. We want to ensure that there are competitive pressures in that market. In the light of the consultation that we have undertaken on pension charges, the work undertaken by the FCA and the analysis of the evidence that has already emerged on the ABI code of conduct and so on, we want to ensure that the spotlight remains on the market, so that we do everything we can to ensure that it works effectively for consumers.

We are committed to ensuring that consumers have access to retirement income options that provide a reliable and decent income throughout retirement. That is an agenda to which ministerial colleagues in the Treasury and the Department for Work and Pensions and I are committed. We are working together to ensure that consumers have appropriate options, value for money and support when they come to turn their hard-earned pension savings into a retirement income. As the Minister of State, Department for Work and Pensions, my hon. Friend the Member for Thornbury and Yate (Steve Webb), who has responsibility for pensions, has recently suggested,reforms will be considered in the context of that work. That is why the Treasury and the DWP are currently considering the broad range of research and evidence on decumulation and how the market is working—to explore the impacts and interactions between market and consumer behaviour and Government policy.

I thank my hon. Friend the Member for Gloucester for securing and opening this debate. It has allowed us to discuss important annuities issues that are crucial for consumers if they are to secure the best from their savings at retirement.

[Richard Graham]

Will the Minister give way?

[Mr Gauke]

I will certainly give way to my hon. Friend—I can assure him that I am not about to conclude my remarks in the next sentence or two.

[Richard Graham]

I will be very brief, and I am grateful to my hon. Friend for his very measured reply to the debate. When the FCA review is published and when the ABI one-year review of the code of conduct comes out, the Treasury—as the Minister was saying—will look closely at how well the market is working. Just so we can be absolutely clear, if there is evidence that it is not working as well as it should and that there are hidden commissions, unnecessary charges and all the rest of it, will they be taken into consideration and reviewed and changed if need be?

[Mr Gauke]

Let me put it this way: the industry, the Government, the regulator and consumers all have roles to play in ensuring that consumers get the best deal. So far, action by the Government, the industry and the regulator has focused on ensuring that the market works more effectively to ensure that consumers shop around; identifying conduct risks that prevent them from doing so; and ensuring that they have the right tools and information to make informed choices and provide competitive pressure on the market. However, as I said earlier, those measures are only as effective as the changes they bring about, and they should not stop here.

The Government look forward to the results of the ABI’s evaluation of the effectiveness of its code, and to the FCA’s findings following its thematic review of the market and how consumers are being treated. They will complement the Government’s review of the evidence on how the market is operating and whether improvements are necessary. However, to answer directly the question put by my hon. Friend, the Government are serious about ensuring that the action already under way has a clear and positive impact. We have not ruled out further action in future.

Oral Answers to Questions

Debate between Richard Graham and David Gauke

Tuesday 25th June 2013 Commons Chamber

[The Exchequer Secretary to the Treasury (Mr David Gauke)]

In January 2013 a new income tax charge was introduced to reduce or remove the financial benefit of receiving child benefit for those on high incomes. For taxpayers with incomes between £50,000 and £60,000, the amount of the charge is a proportion of the child benefit received. For taxpayers with income above £60,000, the amount of the charge is equal to the amount of child benefit received. Eighty-five per cent. of families with children continue to benefit in full from child benefit. Entitlement to child benefit payments remains universal and will continue to be paid to all those who claim it.

[Richard Graham]

I am delighted to hear about the savings that will be achieved, especially given that those of us who supported them were told by the Labour party that they would destroy the universal principle, and that they were complicated, unfair and unworkable. It now appears that they are workable, and the Opposition have accepted that they will not change the policy. Will my hon. Friend share with us what vital provision of services those savings can achieve, and will he also consider means-testing the winter fuel allowance?

[Mr Gauke]

There is a substantial saving to the Exchequer through child benefit. It was not that long ago when the Leader of the Opposition said that millionaires should receive child benefit because

“it’s a cornerstone of our system to have universal benefits”.

It appears that that is no longer the case, although all we have is briefing. On winter fuel payments, the Prime Minister made it clear that they would continue in the course of this Parliament and we will fulfil that commitment.

Oral Answers to Questions

Debate between Richard Graham and David Gauke

Tuesday 14th May 2013 Commons Chamber

[The Exchequer Secretary to the Treasury (Mr David Gauke)]

The difficulty is that if we were to reduce VAT on repairs and refurbishments, that would have a substantial fiscal cost. It would result in more borrowing and that is not something we can afford because of the circumstances we were left.

[Richard Graham (Gloucester) (Con)]

We now know there was no triple-dip recession and almost certainly no double-dip recession either. Of course there is no room for complacency, which is why I am holding my seventh jobs fair in the centre of Gloucester this Thursday. Does the Minister agree that it is time for the party of doom and gloom on the Opposition Benches to recognise that the economy is beginning to recover and that it is time to support British business—especially things made in Gloucester?

Changes to the Budget

Debate between Richard Graham and David Gauke

Monday 11th June 2012 Commons Chamber

[Mr Gauke]

Many Members on the Government Benches engaged with this issue in a constructive and thoughtful way, and helped us reach what I think was the right conclusion.

[Richard Graham (Gloucester) (Con)]

Most of my constituents want their Government, regardless of political hue, to be a Government who listen and appreciate their views. In this case, the changes made by my hon. Friend and the Treasury team have hugely benefited listed places of worship, which are an important part of our regeneration campaign, and an important local company, Janes Pantry, which makes pasties. They have also been much appreciated by all of us who donate to charities. We cannot have it both ways: we cannot have a Government who listen and then criticise them when they do. I am grateful to the Government.

Finance (No. 4) Bill

Debate between Richard Graham and David Gauke

Thursday 19th April 2012 Commons Chamber

[Mr Gauke]

The number affected is very clear. We have published it in the tax information impact note. It is 4.4 million people, as we have made clear throughout. But as I say, nobody loses out in cash terms, and the increase in the personal allowance is the largest increase ever.

[Richard Graham (Gloucester) (Con)]

We heard from the Opposition some extraordinary statements which included the phrase “levelling down”. Will my hon. Friend confirm for the benefit of all Members of the House that the changes made to the tax-free element of income affect 24 million workers and take another 850,000 workers out of income tax altogether? That is called levelling up, not levelling down.

[Mr Gauke]

My hon. Friend is absolutely right. What we are seeing, and what we have seen over the past few years while this Government have been in office, are rapid increases in the personal allowance. The main personal allowance is rapidly catching up with the age-related allowance, which gives us this opportunity to make the simplification, as we are doing.

Those who are affected by the withdrawal of age-related allowances will still see the total amount of deductions that they pay reduce significantly compared to those under the age of 65, because we are retaining the exemption from national insurance contributions for those of state pension age. So, for example, even under the freeze, a 69-year-old with an income of £18,000 in 2013-14 will pay less than half as much in tax and national insurance contributions as someone aged 30 earning the same amount.

--- Later in debate ---

[Mr Gauke]

The Rooker-Wise amendment related to tax thresholds. As for indexation, we are using the higher of earnings or inflation or 2.5%. The plans we inherited were just earnings. That is an important point.

Despite difficult economic conditions, the Government continue to protect benefits for pensioners, including winter fuel payments, free bus passes and free prescriptions, to name but a few. Many pensioners are also benefiting from the Government’s decision to make funding available to local authorities to freeze council tax, and we also have the Warm Homes discount. The Institute for Fiscal Studies has submitted evidence to the Treasury Committee showing that pensioners are the group least affected by the tax and benefit changes implemented by the Government. It has given evidence that pensioners have benefited the most from the distributional impact of tax and benefit changes for some years. I assure the House that the Government are supporting, and will continue to support, pensioners.

[Richard Graham]

My hon. Friend raises some valid points about how much the Government have done for pensioners throughout the country, referring to all those crucial changes, such as the triple lock, the link back to earnings, and the retention of all the benefits that pensioners have. My constituents remember the sharp contrast between the rise in the basic state pension of 10% since the Government took office and the 75p offer from the previous Government, which, with collective amnesia, they seem to have entirely forgotten.

[Mr Gauke]

My hon. Friend is right to remind the Committee of that.

We must ask ourselves whether pensioners are disproportionately affected by Government policies. The answer is clearly no. The evidence is very clear on that. After the reforms, does the tax system treat pensioners unfairly? No. By definition, having one personal allowance across the board, regardless of age, is not unfair on pensioners. Is there a strong, principled case for different personal allowances based on age? We have not heard that case made today, other than the fact that Winston Churchill thought it was a good idea in 1925. The official Opposition’s policy is to tell everyone under 65 that they should have a lower personal allowance than those over 65.

Clause 4 supports the Government’s long-term aim of simplifying the tax system by creating a single personal allowance. It removes the complicated tapering system, making personal allowances easier to understand. In the longer term we will have a single, generous personal allowance for everyone while ensuring that no one is a cash loser. I ask the hon. Member for Leeds West (Rachel Reeves) to withdraw the amendment.

Budget Leak Inquiry

Debate between Richard Graham and David Gauke

Thursday 22nd March 2012 Commons Chamber

[Mr Gauke]

That is clearly not an issue for the Treasury. The Government will respond to the points that the hon. Gentleman has raised in due course.

[Richard Graham (Gloucester) (Con)]

I would not dream of accusing anybody on the Opposition Benches of hypocrisy, but the last time I saw more assembled piety than there is on those Benches today was when I visited a Catholic convent in the southern Philippines in 1985. Has it occurred to the Minister, as it has occurred to me, that this urgent question is simply a distraction from the debate on a Budget for jobs and growth that helps working people? That is what my constituents in Gloucester want to hear us debate today.

[Mr Gauke]

I understand concerns about there being a debate before the Budget, but now Opposition Members do not seem to want a debate on Government measures after the Budget. I think we should have that debate.

Oral Answers to Questions

Debate between Richard Graham and David Gauke

Tuesday 22nd March 2011 Commons Chamber

[Mr Gauke]

A week ago, the shadow Chancellor was saying that we needed an immediate cut in the tax on fuel and now the Labour party is saying that we should start a process that will take about seven years. That does not strike me as being terribly helpful.

[Richard Graham (Gloucester) (Con)]

In terms of the value for money of decisions taken by the Treasury, whether on road fuel tax or other things, does the Minister agree that one of the best value creations of this Government has been the increase in apprenticeships, which is widely appreciated around the country? Does he agree that apprenticeships are critical both to our growth strategy and to the reduction of youth—

Oral Answers to Questions

Debate between Richard Graham and David Gauke

Tuesday 16th November 2010 Commons Chamber

[Mr Gauke]

It does families and everyone else in this country no good if we do not get to grips with the fiscal crisis. If the Opposition are saying households paying higher rate income tax should continue to receive child benefit while those who do not earn so much contribute towards that, it once again shows that they are not getting to grips with the scale of the crisis.

[Richard Graham (Gloucester) (Con)]

Does the Minister agree that the logic of the policy outlined by Opposition Members is that any child from Prince William and Catherine Middleton would benefit from child tax benefit, whereas the poorest of my constituents would not?

PAYE Contributions

Debate between Richard Graham and David Gauke

Wednesday 8th September 2010 Commons Chamber

[Mr Gauke]

As I said earlier, concession A19 is for taxpayers who have acted in good faith when HMRC has had an opportunity to respond. However, I should also make the point that PAYE has always involved circumstances in which information comes to light after the tax year is completed and an adjustment must be made. That has happened throughout the existence of PAYE, but it has increased over the years as working patterns have changed, which is why we need to look at more fundamental reform of PAYE.

[Richard Graham (Gloucester) (Con)]

Following earlier suggestions of hotlines, what advice would the Minister give to my constituents who feel that they might be affected, but who do not want simply to wait for a letter in their post?

[Mr Gauke]

I urge them to wait. I understand the frustration, but if we are to provide support to people efficiently and effectively, it is better to wait. Limited support can be provided until that letter arrives, so I urge his constituents to be patient.