Finance (No. 2) Bill

Abena Oppong-Asare Excerpts

Committee stage & Committee of the Whole House (Day 1)
Monday 19th April 2021 Commons Chamber

Clauses 109 to 111, schedules 21 to 22, and amendments 43 to 52 will support the development of freeports by encouraging new private investment in each of the eight freeport locations in England. These constitute major aspects of the Government’s freeports programme, which will attract large-scale investment across every region of the UK and make significant contributions to the recovery from the pandemic and to levelling up across the regions. I therefore move that these clauses, schedules and amendments stand part of the Bill.

[Abena Oppong-Asare (Erith and Thamesmead) (Lab)]

It is a pleasure to speak for the Opposition on the clauses relating to freeports. I will speak to new clause 25 in my name and the names of my hon. and right hon. Friends. Before I turn to the detail of our new clauses in this group, I would like to say a little about Labour’s position on freeports and regional economic policy more generally.

Labour wants to see good new jobs created in every region and nation of the United Kingdom. We want to see genuine levelling up that hands power and opportunity to areas that have been deprived of them for too long. We want an economic policy that addresses the fundamental challenges facing our country and our constituents: ever widening regional inequality, low productivity and low wages in too many places; a social care crisis that threatens the dignity of older people; and an environmental crisis that threatens us all.

I am afraid that the Government’s approach to levelling up has been far less ambitious. We have seen regions and areas pitted against each other to bid for pots of money, only to find that Conservative Ministers overruled officials and handed funding to already wealthy areas. We have seen nothing to make up for the 11 years of a Conservative Government who have sucked funding and opportunities out of areas that they now say need levelling up. We have seen a total lack of ambition from the Government on supporting a recovery from the coronavirus crisis to build a stronger and more resilient economy. That brings me to freeports and the clauses that we are considering today.

I think we were all a little underwhelmed when the rabbit pulled from the hat at the end of the Chancellor’s Budget speech last month was the reannouncement of his freeports policy. The Opposition simply do not believe that freeports are the silver bullet for our post-Brexit economy that the Chancellor clearly hopes they are. In fact, the evidence is that freeports are likely to have relatively little impact on overall job creation and are far more likely to move jobs from one place to another. We want every area to flourish, whether or not they have a freeport. We know that Ministers are aware of this problem because they asked potential freeports operators to address it in their bids. Our new clause 25 would require the Government to produce an annual review of the impact of the freeports policy on job creation in freeport sites and across the country as a whole.

[Jesse Norman]

I would be grateful if the hon. Lady could tell us whether the Labour party’s position is to support freeports or not to support freeports.

[Abena Oppong-Asare]

I thank the Minister. I will approach that later in my speech, so I thank him for already guessing what I was going to say.

We really need some honesty and transparency from the Government on this. The estimates of the job creation benefits of freeports made by their advocates so far have been flimsy to say the least. We also need a proper assessment of the risk of job displacement. If freeports simply move existing economic activity around, they risk doing harm to the economic fortunes of neighbouring areas, with no net benefit to the country as a whole. Indeed, a 2019 report by the UK Trade Policy Observatory found that the main effect of freeports was to divert businesses into a port from a surrounding area, rather than creating new jobs, so it is not just Labour saying this; it is the experts saying it too. That may be especially problematic in areas where freeports are situated near a local authority, or regional or even national borders.

Our new clause would require the Government to report on tax avoidance and evasion and criminal activity in freeports and to set out the level of additional staffing and resources required by HMRC and other Government bodies. There are long-standing concerns that freeports allow or encourage tax avoidance and evasion, and there is international evidence that freeports have been used for criminal activity. For example, the OECD has stated that there is

“clear evidence that free trade zones are being used by criminals to traffic fake goods”.

The Financial Action Task Force has said that the lack of scrutiny can facilitate trade-based money laundering through relaxed oversight and a lack of transparency. The TUC and others have warned of the dangers to workers’ rights from deregulation in freeports. We need to take these concerns seriously. As a minimum, the Government should commit to trade union representation in the governance of freeports at local and national levels.

I will now make a few points about the clauses we are considering. First, on the cost of the tax reliefs being introduced, the Government have provided some information on the expected operational costs of HMRC but, as recently as last month, they were unable to estimate the reduced revenue that the Exchequer will receive as a result of these reliefs. I hope the Minister can address that. Clause 110 includes the enhanced capital allowance for plant and machinery spending at 100%, but that is less generous than the 130% super deduction. Presumably, for the period that they overlap, companies will need to consider whether they can claim the super deduction rather than this allowance.

The Chartered Institute of Taxation has raised a number of concerns about the operation of the stamp duty relief in clause 111. One issue is how exactly freeport tax sites will be designated and whether particular buildings can be identified as either in or out the boundary of the tax site. Can the Minister provide some clarity on joint ventures where there is both commercial and residential development? The Chartered Institute of Taxation points out that the clause, as currently drafted, excludes a common commercial arrangement from that relief. Finally, there is the issue of withdrawal of relief for subsequent non-qualifying activity. A small amount of non-qualifying use can potentially lead to withdrawal of all the relief. Is the Minister concerned that the risk of loss of the full relief in such circumstances could discourage investment?

To conclude, the Opposition have real concerns about the Government’s freeports policy. If it is going to succeed and bring the sorts of benefit that those on the Government Benches claim, we need to see more detail on the operation of freeports and how the Government plan to mitigate the risks. We need regular monitoring of the effectiveness and the impact on the country as a whole over the years to come, which is exactly what new clause 25 would require the Government to do. If the Government are confident in their policy, they should be confident in allowing scrutiny of how it works in practice. I call on them to support our new clause.

[Richard Thomson]

I would like to add my support for the Opposition amendments and to seek a commitment from the Government, while the Minister is here, to allow the Scottish Government after the Scottish elections to move ahead with their greenports adaptation of the freeports concept. Freeports do not require Brexit in order to be brought about, and legitimate questions remain about how much additional economic activity they will actually generate, rather than simply displace from other areas of the economy.

Finance (No. 2) Bill

Abena Oppong-Asare Excerpts

Committee stage & Committee of the Whole House (Day 2)
Tuesday 20th April 2021 Commons Chamber

Temporary Period For Reduced Rates On Residential Property

[Abena Oppong-Asare (Erith and Thamesmead) (Lab)]

I beg to move amendment 81, in page 49, leave out lines 14 to 27.

This amendment would mean that the Stamp Duty Land Tax (Temporary Relief) Act 2020 no longer applies to additional dwellings.

[The Temporary Chair (Siobhain McDonagh)]

With this it will be convenient to discuss the following:

Clauses 87 to 89 stand part.

That schedules 16 and 17 be the Sixteenth and Seventeenth schedules to the Bill.

Clauses 90 and 91 stand part.

New clause 26—Equality impact analysis (No. 2)—

“(1) The Chancellor of the Exchequer must review the equality impact of sections 87 to 89 and schedule 16 and 17 of this Act and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must consider the impact of those sections on—

(a) households at different levels of income,

(b) people with protected characteristics (within the meaning of the Equality Act 2010),

(c) the Treasury’s compliance with the public sector equality duty under section 149 of the Equality Act 2010, and

(d) equality in England, Northern Ireland and in different regions of England.

(3) A review under this section must provide a separate analysis in relation to each of the following matters—

(a) the temporary period for reduced rates on residential property,

(b) increased rates for non-resident transactions, and

(c) relief from higher rate charge for certain housing co-operatives etc.

(4) In this section “regions of England” has the same meaning as that used by the Office for National Statistics.”

This new clause requires the Chancellor of the Exchequer to carry out and publish a review of the effects of sections 87 to 89 and schedules 16 and 17 of the Bill 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 geographical basis.

New clause 27—Fiscal and economic impact of 2% non- resident surcharge—

“(1) The Chancellor of the Exchequer must review the impact of section 88 and schedule 16 and lay a report of that review before the House of Commons within six months of the passing of this Act and once a year thereafter.

(2) A review under this section must estimate the expected impact of section 88 and schedule 16 on—

(a) Stamp Duty Land Tax revenue at the increased rates of 2%, and what the revenue impact would have been if the rate had been 3%,

(b) residential property prices, and

(c) affordability of residential property.”

This new clause would require the Government to report on the effect of the 2% stamp duty land tax non-resident surcharge on tax revenues and on the price and affordability of property.

[Abena Oppong-Asare]

It is a pleasure to speak for the Opposition on this group of amendments and new clauses relating to stamp duty. I rise to speak on those in my name and those of my right hon. and hon. Friends.

Amendment 81 will prevent the extension of stamp duty holiday from being used for second homes, buy-to-lets and investment properties. New clause 26 would require the Government to review the equalities impact of this group of clauses, including their impact on households with different income levels and on people with protected characteristics, their compliance with the public sector equality duty and their impact on the different regions and nations of the United Kingdom. New clause 27 would require the Government to review the impact of a non-residential surcharge of 2%, which it is set at in the Bill, and 3%, which, as I shall come on to, the Conservative party previously committed to.

Before I come on to the amendments in more detail, let me say a little about the stamp duty holiday extension. Clause 87 extends the £500,000 nil rate band until 30 June. From July until the end of September, the nil rate band will be £250,000, double its normal level; it will return to the usual level of £125,000 from 1 October. It is estimated that the total cost of this extension will be £1.5 billion by the end of 2021-22. That is on top of the £3.2 billion cost of the initial stamp duty land tax holiday announced in July 2020.

The extension will of course be welcome news for those people in the process of buying a new home who face a cliff edge at the end of March. We know that many people have struggled to complete purchases in time due to the coronavirus restrictions and the significant backlog of pending transactions. In previous debates, Members raised issues of cyber-attacks on council services in Hackney that impacted the planning department and delayed people’s securing mortgages.

However, we have concerns about the broader effects of the policy. Our new clause 26 is intended to encourage the Government to be honest about the impact of the stamp duty holiday on the housing market. The Resolution Foundation says that the lower stamp duty liabilities have contributed to house price rises over the last eight months. House prices in England grew 7% between July and December 2020, which is highly unusual behaviour during a recession. In many cases, the rise in house prices over the period will have cancelled out the benefit of the stamp duty holiday. As the Institute for Fiscal Studies, the Resolution Foundation and others have pointed out, the stamp duty holiday has also had the perverse effect of temporarily removing the advantage that first-time buyers had in the market compared with existing homeowners. This, coupled with rapidly rising house prices, has meant that many first-time buyers continue to be priced out of the market. The Bill does nothing to address the housing crisis that affects millions of families across the country—yet again, a wasted opportunity from this Government.

I turn now to clause 88 and our amendment 81. It is unbelievable that, at the same time as the Chancellor is pressing ahead with a £2 billion council tax rise, he has given another tax break to second-home owners and buy-to-let landlords. This half a billion pound tax break for second-home owners and landlords is the wrong priority in the middle of an economic crisis that is hitting family incomes. Instead, this money could have been used to build nearly 3,000 socially rented homes, which is half the total built in England last year. In Wales, the equivalent tax relief has not been extended to property acquired as investment or as a second home. Labour’s amendment 81 would ensure that the extended stamp duty holiday in England and Northern Ireland followed that approach. I turn to the non-residential surcharge introduced under clause 88. During the 2019 general election campaign, the Chancellor, who was then Chief Secretary to the Treasury, said:

“Evidence shows that by adding significant amounts of demand to limited housing supply, purchases by non-residents inflate house prices.”

He went on to announce a Conservative manifesto commitment to introduce a non-resident stamp duty surcharge of 3%, which would have been spent on programmes aimed at tackling rough sleeping. But clause 88 introduces a non-resident surcharge of 2%, rather than 3%. As yet, we have had no explanation from the Government as to why they have watered down that commitment. We estimate that this means the Government could miss out on £52 million a year in revenue that should have been spent on tackling homelessness and rough sleeping.

Our new clause 27 would require the Government to review the difference between the 2% charge and the 3% charge and to reveal the lost income as a result of that decision. When the Minister stands up, perhaps he will tell us why the Government have moved from 3% to 2%.

We welcome clauses 89 to 91, which provide relief from the annual tax on enveloped dwellings and the 15% stamp duty charge for the ownership and transfer of property by housing co-operatives that do not have transferable share capital. The Treasury has listened to the co-operative housing sector on the issue and that is welcome.

To conclude, we do not believe that the Government’s clauses in this group would do anything to solve the housing crisis we face in this country. Year after year, Government have failed to build the homes we need, especially social and affordable homes. The Government are on track to miss their target of building 300,000 homes by almost a decade. The number of new social rented homes has fallen by over 80% since 2010 and home ownership is down sharply among young people, with 800,000 fewer households under 45 owning their home than in 2010. Without urgent action the housing crisis in the UK will deepen. Instead the Government have decided to give a tax break to landlords and failed to meet their own commitment on the non-residential surcharge. Our amendments will remedy these wrongs.

[Jesse Norman]

Last spring, we were only just beginning to understand as a nation what the full impact of the coronavirus might mean for us. We were told to stay at home and, for many people, that meant postponing plans that they might have made to move, creating considerable uncertainty. It was evident that the housing market was affected by that and it was made much worse when, on 26 March, buying and selling a property was largely put on hold. While business was enabled to resume from 13 May, there was concern about what the pandemic would mean for the market and for the jobs that rely on the sector.

The Chancellor announced that he would support the housing market through the stamp duty land tax holiday, quadrupling the starting threshold for SDLT to £500,000. That was designed to give a boost—indeed, the boost to the housing market that it needed to thrive through the pandemic. It has thrived: transactions in the last quarter of 2020 were 16% higher than in the same period in 2019. In other words, the SDLT holiday has given hundreds of thousands of families the confidence to buy and to sell their homes at a particularly difficult time. In turn, it has supported the livelihoods of people—tens of thousands of them, or more than that—whose businesses and jobs rely on trade with, through and from the housing market.

Towards the end of last year, it became apparent that the housing industry was struggling to meet the additional demand to move home and that there were delays in processing transactions. That meant that some of those moving home would not be able to complete the transactions that they had entered into until after the holiday ended, through no fault of their own. The Bill therefore extends the stamp duty land tax holiday in order to allow those buyers still to receive the relief. In addition, the nil rate band will be £250,000, double its standard level, until the end of September, in order to allow the market to return smoothly to its normal rates.

The Bill also introduces a non-residential SDLT surcharge. The surcharge will apply to property purchases by non-UK residents who do not come to live and work here, helping to ease house price inflation and to keep housing free for UK residents to buy. Revenue raised from the surcharge will be used to help address the issue of rough sleeping.

The hon. Member for Erith and Thamesmead (Abena Oppong-Asare) raised the question about the non-resident surcharge. She may not be aware that, at Budget 2018, the Government announced that a consultation for a 1% non-UK resident surcharge would be published. Following the announcement of the surcharge, HMRC and the Treasury carried out a public consultation in spring 2019. That included questions on whether a 1% rate was set at the right level to balance the Government’s objectives on home ownership with those of the UK remaining an open and dynamic economy. Having listened to stakeholders, the Government believe that the 2% surcharge—twice the original amount contemplated—strikes the right balance in this area. That is the basis on which the surcharge has been set.

The Bill will also relieve the 15% rate of SDLT and the annual tax for enveloped dwellings for qualifying housing co-operatives. That change ensures that these measures are fairly targeted at companies that use so-called envelopes in order to avoid tax on their properties.

Amendment 81 would disapply the SDLT holiday to purchases of additional dwellings. As the Committee will know, the SDLT holiday was intended to give a boost to the entire property market, of which developers and landlords are important parts. Although those buying second homes or buy-to-let properties will benefit from that tax change, they will continue to pay an additional 3% on top of the standard SDLT rates.

The Government have maintained the relative advantage that buyers of main homes had before the tax change. For example, the purchaser of a second home worth £500,000 will still pay £15,000 in SDLT, compared with nothing for the purchase of a main residence. It was a Conservative Government who introduced the phasing out of finance cost relief, and the higher rates of SDLT for the purchase of additional property—all steps towards a more balanced tax treatment between homeowners and landlords.

On new clause 26, HMRC routinely publishes information about SDLT, collected by house price bands and by region. Of course, a full tax impact assessment, including equalities impacts, has been published for each measure.

Extending the SDLT holiday ensures that buyers who were affected by delays in the industry will still be able to receive the tax relief.

In the longer term, the Bill introduces a new surcharge that will help more people on to the housing ladder through the new non-UK residents’ surcharge. It also ensures that stamp duty and the annual tax on enveloped dwellings remain fair by making certain that only those who the Government intend to pay corporate rates of tax are captured.

--- Later in debate ---

[Jesse Norman]

I do not think I will ever give a more popular speech than the one I am going to give now, because I just want to thank everyone who has made comments. I thank the hon. Member for Erith and Thamesmead (Abena Oppong-Asare) for her remarks, which I have already answered. I thank colleagues for the speeches they have made to explore the effects, purpose and potential limits, even, of the stamp duty land tax and the holiday. I ask Members to support the clauses, and I will sit down.

[Abena Oppong-Asare]

This has been a good debate, and I too thank Members on both sides of the House for their contributions. Members on both sides have spoken on behalf of their constituents about the impact of the stamp duty holiday, the challenges of buying a home and the need for more action to make affordable housing a reality.

As I said in my opening contribution, the Opposition simply do not believe that the Government should be handing a half a billion pound tax break to buy-to-let investors and second home buyers. Once again, this is the wrong priority from a Government who are letting families down. Labour’s amendment 81 would end that unfairness, and I want to press it to a vote.

Question put, That the amendment be made.

Finance Bill

Abena Oppong-Asare Excerpts

Report stage & 3rd reading
Monday 24th May 2021 Commons Chamber

Brought up, and read the First time.

[Abena Oppong-Asare (Erith and Thamesmead) (Lab)]

I beg to move, That the clause be read a Second time.

[Madam Deputy Speaker (Dame Rosie Winterton)]

With this it will be convenient to consider the following:

Amendment 24, page 63, line 9, leave out clause 109.

This and the other amendments relating to clauses 109 to 111 would prevent the creation of freeport tax sites in the UK.

Amendment 25, page 63, line 31, leave out clause 110.

This and the other amendments relating to clauses 109 to 111 would prevent the creation of freeport tax sites in the UK.

Amendment 26, page 64, line 1, leave out clause 111.

This and the other amendments relating to clauses 109 to 111 would prevent the creation of freeport tax sites in the UK.

[Abena Oppong-Asare]

I rise to speak to new clause 25, tabled in my name, and those of the Leader of the Opposition and my hon. Friends. The new clause sets out a number of tests that we believe the Government must apply to each and every freeport created in the UK. Before I come to the detail of those tests, I will make a couple of brief points about the Government’s intentions behind freeports. As I said in Committee, Labour wants every area to succeed, whether or not it has a freeport. We want good new jobs to be created right across the country, and our great British industries to be protected and supported. We want to see the UK at the forefront of new green manufacturing and technology, and we want a genuine re-distribution of power and opportunity to places that have been denied that for so long.

The Government clearly believe that freeports are a silver bullet for solving regional inequalities, and I simply remind them that they have been in power for 11 years now. Let me repeat that: 11 years. They must own the choices they have made, such as abolishing regional development agencies, cutting local authority funding, and pulling opportunities away from young people in some of the most deprived regions of the UK. Just recently, they scrapped the industrial strategy altogether. We need a proper plan that creates jobs and opportunities for everyone, regardless of where they live.

I will now turn to the new clause, and to the tests against which we believe our freeports should be judged if they are to succeed. First, freeports must create jobs, not simply move them from elsewhere. Too often, attempts at regional rebalancing have simply shuffled jobs around rather than creating them in the places that need them. We must end the scandal of people being forced to move to the other end of the country to find a decent job. Our test will be this: if someone lives near a freeport, will new opportunities be opened to them that did not exist before? Conversely, if an area does not have a freeport, can we be confident that it will not lose jobs as a result of this policy? Of course, any new jobs must be secure and well paid, with trade union rights—the kind of jobs we have not seen anywhere near enough of over the last decade.

Secondly, freeports must deliver improvements in training and skills for local residents. As we begin to recover from the pandemic, the need for re-training will become even more acute. We need a genuine skills guarantee for everyone, and freeports must play their part in that. Labour will be looking to see how companies operating in freeports work with their local communities to provide skills and training opportunities. Rather than a race to the bottom, freeports should be helping to boost skills and open opportunities.

Thirdly, freeports must produce tangible transport and infrastructure improvements beyond the port itself. Too many places still lack basic transport infrastructure, and too many people still find it difficult to get around. The investment that the Government are making in freeports must go towards boosting connectivity for everyone in those areas. We want every community to benefit from affordable and reliable public transport.

--- Later in debate ---

I am confident that Opposition Members do not want to delay the investment associated with the relevant clauses. The implementation of that investment will help to unlock employment and stimulate growth in areas that have too often been left behind, so I urge the House to reject amendments 24 to 26 and new clause 25.

[Abena Oppong-Asare]

I thank all Members who have spoken for their contributions. In particular, I thank my right hon. Friend the Member for Hayes and Harlington (John McDonnell), who raised a number of concerns—including on tax avoidance and the potential damage to nearby areas—about how freeports will operate.

The Government Members who spoke in the debate are obviously more optimistic about the potential impacts of freeports on the communities that they represent. In respect of the comment made by the hon. Member for Redcar (Jacob Young), let me say that no one is talking Teesside down. I am very clear that we want to make sure that everyone will succeed, whether or not they have a freeport in their area. Why is that a bad thing?

We believe that our new clause and the tests it contains set out a reasonable way to assess the impact of freeports on their local areas and the country as a whole. We on the Opposition Benches are ambitious for our country, but we need to see clear evidence that freeports are going to be effective in meeting the challenges that we face. I therefore call on Members to support our new clause, because it is the right thing to do.

Question put, That the clause be read a Second time.

--- Later in debate ---

Brought up, and read the First time.

[Abena Oppong-Asare]

I beg to move, That the clause be read a Second time.

[Mr Deputy Speaker (Mr Nigel Evans)]

With this it will be convenient to consider the following:

New clause 1—Equality impact analysis—

‘(1) The Chancellor of the Exchequer must review the equality impact of sections 87 to 89 and schedule 16 and 17 of this Act and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must consider the impact of those sections on—

(a) households at different levels of income,

(b) people with protected characteristics (within the meaning of the Equality Act 2010),

(c) the Treasury’s compliance with the public sector equality duty under section 149 of the Equality Act 2010, and

(d) equality in England, Northern Ireland and in different regions of England.

(3) A review under this section must provide a separate analysis in relation to each of the following matters—

(a) the temporary period for reduced rates on residential property,

(b) increased rates for non-resident transactions, and

(c) relief from higher rate charge for certain housing co-operatives etc.

(4) In this section “regions of England” has the same meaning as that used by the Office for National Statistics.’

This new clause requires the Chancellor of the Exchequer to carry out and publish a review of the effects of sections 87 to 89 and schedules 16 and 17 of the Bill 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 geographical basis.

New clause 24—Review of impact of 2% non-resident surcharge—

‘(1) The Chancellor of the Exchequer must review the impact of section 88 and schedule 16 of this Act on tax revenues, residential property prices, affordability of residential property, and the volume of property purchases by non-residents, and lay a report of that review before the House of Commons within six months of the passing of this Act and once a year thereafter.

(2) The review under this section must include an assessment of what those impacts would have been if the provisions in the Draft Registration of Overseas Entities Bill had been in force.’

This new clause would require the Government to report on the effect of the 2% stamp duty land tax non-resident surcharge on tax revenues, property prices and affordability, and the volume of property purchases by non-residents, and also to assess what the impacts would have been if the Draft Registration of Overseas Entities Bill were in force.

Government amendments 4 to 6.

Government new clauses 17 to 20.

New clause 3—Review into the effects of replacement of LIBOR—

‘(1) The Chancellor of the Exchequer must undertake a review within six months of the passing of this Act of the effects of sections 128 and 129.

(2) This review must consider—

(a) the implications for tax revenue,

(b) effects on financial stability, and

(c) effects on businesses that use LIBOR as a benchmark, including businesses offering supply chain finance.’

This new clause would require a review into the effects of the provisions of the Bill about replacing LIBOR.

New clause 4—Assessment of environmental impact of Act—

‘(1) The Chancellor of the Exchequer must review the effectiveness of the provisions of this Act in accordance with this section and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must assess the effects of the provisions on—

(a) the achievement of the Government’s targets to reduce carbon emissions, and

(b) the United Kingdom’s progress towards net-zero emissions.’

New clause 5—Equality impact analyses of provisions of this Act—

‘(1) The Chancellor of the Exchequer must review the equality impact of the provisions of this Act in accordance with this section and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must consider the impact of those provisions on—

(a) households at different levels of income,

(b) people with protected characteristics (within the meaning of the Equality Act 2010),

(c) the Government’s compliance with the public sector equality duty under section 149 of the Equality Act 2010, and

(d) equality in different parts of the United Kingdom and different regions of England.

(3) A review under this section must include a separate analysis of each section of the Act, and must also consider the cumulative impact of the Act as a whole.’

New clause 7—Analysis of effectiveness of provisions of this Act on tax avoidance and evasion—

(1) The Chancellor of the Exchequer must review the effectiveness of the provisions of this Act in accordance with this section and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must—

(a) assess the effects of the provisions in reducing levels of artificial tax avoidance,

(b) assess the effects of the provisions in combating tax evasion and money laundering, and

(c) estimate the role of the provisions of this Act in reducing the tax gap in each tax year from 2021 to 2024.’

New clause 8—Review of public health and poverty effects—

‘(1) The Chancellor of the Exchequer must review the public health and poverty effects of the provisions of this Act and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must consider—

(a) the effects of the provisions of this Act on the levels of relative and absolute poverty in the UK,

(b) the effects of the provisions of this Act on socioeconomic inequalities and on population groups with protected characteristics as defined by the 2010 Equality Act,

(c) the effects of the provisions of this Act on life expectancy and healthy life expectancy in the UK, and

(d) the implications for the public finances of the public health effects of the provisions of this Act.’

New clause 9—Review of changes to coronavirus support payments etc—

‘(1) The Chancellor of the Exchequer must review the impact on investment in parts of the United Kingdom and regions of England of the changes made to coronavirus support payments etc by this Act and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must consider the effects of the provisions on—

(a) business investment,

(b) employment,

(c) productivity,

(d) GDP growth, and

(e) poverty.

(3) A review under this section must consider the following scenarios—

(a) the coronavirus job retention scheme and the self-employment income support scheme are continued until 30th September 2021, and

(b) the coronavirus job retention scheme and self- employment income support scheme are continued until 31st December 2021.

(4) In this section—

“parts of the United Kingdom” means—

(a) England,

(b) Scotland,

(c) Wales, and

(d) Northern Ireland;

and “regions of England” has the same meaning as that used by the Office for National Statistics.’

This new clause would require a report comparing the effect of (a) the coronavirus job retention scheme and the self-employment income support scheme being continued until 30 September 2021 and (b) the coronavirus job retention scheme and self-employment income support scheme being continued until 31 December 2021 on various economic indicators.

New clause 10—Review of changes to VAT—

‘(1) The Chancellor of the Exchequer must review the impact on investment in parts of the United Kingdom and regions of England of the changes made to VAT by this Act and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must consider the effects of the provisions on—

(a) business investment,

(b) employment,

(c) productivity,

(d) GDP growth, and

(e) poverty.

(3) A review under this section must consider the following scenarios—

(a) the extension of temporary 5% reduced rate for hospitality and tourism sectors is continued until 30th September 2021, and

(b) the extension of temporary 5% reduced rate for hospitality and tourism sectors is continued until 31st December 2021.

(4) In this section—

“parts of the United Kingdom” means—

(a) England,

(b) Scotland,

(c) Wales, and

(d) Northern Ireland;

and “regions of England” has the same meaning as that used by the Office for National Statistics.’

This new clause would require a review comparing (a) the extension of temporary 5% reduced rate for hospitality and tourism sectors being continued until 30 September 2021 and (b) the extension of temporary 5% reduced rate for hospitality and tourism sectors being continued until 31 December on various economic indicators.

New clause 11—Review of effect on tax revenues—

‘(1) The Chancellor of the Exchequer must review the effects on tax revenues of the provisions of this Act, and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must—

(a) consider the expected change in corporation and income tax paid attributable to the provisions, and

(b) make an estimate of any change attributable to the provisions in the difference between the amount of tax required to be paid to the Commissioners and the amount paid.

(3) The reference to tax required to be paid in subsection 2(b) includes taxes payable by the owners and employees of Scottish limited partnerships.’

This new clause would require a report on the impact of the provisions of the Bill on narrowing the tax gap, assessing the impact of: (a) the expected change in corporation and income tax paid attributable to the provisions and (b) any change, attributable to the provisions, in the difference between the amount of tax required to be paid to the Commissioners and the amount paid. In particular, this includes taxes payable by the owners and employees of Scottish limited partnerships.

New clause 13—Review of impact on GDP—

‘(1) The Chancellor of the Exchequer must review the impact in parts of the United Kingdom and regions of England of the changes made by this Act and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must compare estimated GDP in each of the next five years under the following scenarios—

(a) these provisions are enacted,

(b) these provisions are not enacted, and

(c) the UK fiscal stimulus package, as a percentage of GDP, mirrors that of the United States.

(3) In this section—

“parts of the United Kingdom” means—

(a) England,

(b) Scotland,

(c) Wales, and

(d) Northern Ireland;

and “regions of England” has the same meaning as that used by the Office for National Statistics.’

This new clause would require a report on the impact on GDP of the provisions in the Bill, comparing them with the impact of copying the level of fiscal intervention in the US.

New clause 14—Report on Part 2—

‘(1) The Secretary of State shall, before 1 April 2023, publish a report on the impact of the provisions in Part 2 of this Act.

(2) The report in subsection (1) shall include consideration of the impact on—

(a) the rate of plastic recycling in the UK generally,

(b) the rate of PET plastic recycling in the UK,

(c) the rate of Polypropylene plastic recycling in the UK, and

(d) the rate of HDPE plastic recycling in the UK.

(3) The report in subsection (1) shall include consideration of the impact on—

(a) the volume of plastic used in the UK,

(b) the volume of PET plastic used in the UK,

(c) the volume of Polypropylene plastic used in the UK, and

(d) the volume of HDPE plastic used in the UK.

(4) The report in subsection (1) shall include consideration of the impact on—

(a) the volume of plastic stockpiling in the UK,

(b) the volume of PET plastic stockpiling in the UK,

(c) the volume of Polypropylene plastic stockpiling in the UK, and

(d) the volume of HDPE plastic stockpiling in the UK.

(5) The report in subsection (1) shall consider whether—

(a) £200/tonne provides an economic incentive to change the content of packaging for those types of plastic specified in subsection (2),

(b) the economic incentive in subsection (5)(a) remains in the event of lower than average oil prices, and

(c) a tax escalator might be more efficacious.’

This new clause would require a review of the efficacy of the proposed plastic packaging tax, with respect to whether the proposals will (a) increase use of certain plastics and (b) provide an incentive to recycle in the event of lower than average oil prices.

New clause 15—Review of impact on climate emissions—

‘(1) The Chancellor of the Exchequer must review the impact on climate emissions in parts of the United Kingdom and regions of England of the changes made by this Act and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must consider the effects of the provisions of the Act on progress towards the Government’s climate emissions targets.

(3) In this section—

“parts of the United Kingdom” means—

(a) England,

(b) Scotland,

(c) Wales, and

(d) Northern Ireland;

and “regions of England” has the same meaning as that used by the Office for National Statistics.’

This new clause would require a report on the effects of the Bill on progress towards the UK Government’s climate emissions targets.

New clause 16—Review of impact of section 104—

‘(1) The Chancellor of the Exchequer must review the impact on investment in parts of the United Kingdom and regions of England of the changes made by section 104 and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must consider the effects of the provisions on the volume of gambling, including—

(a) the number of people who take part in gambling,

(b) the amount of money spent on gambling, and

(c) the gross gaming yield.

(3) In this section—

“parts of the United Kingdom” means—

(a) England,

(b) Scotland,

(c) Wales, and

(d) Northern Ireland;

and “regions of England” has the same meaning as that used by the Office for National Statistics.’

This new clause would require a report on the effects of section 104 on the volume of gambling.

New clause 21—Impact of Act on human and ecological health and wellbeing—

‘The Chancellor of the Exchequer must review the impact of the provisions of this Act on human and ecological health and wellbeing, including the wellbeing of future generations, and lay a report of that review before both Houses of Parliament within six months of the passing of this Act.’

This new clause would require the Chancellor of the Exchequer to review the impact of the Finance Bill on human and ecological health and wellbeing, including the wellbeing of future generations.

New clause 26—Review of coronavirus job support schemes—

‘(1) The Chancellor of the Exchequer must lay before Parliament within three months of the passing of this Act a report on the impact of sections 31 to 33 of this Act.

(2) The report must consider the effects of the following two scenarios—

(a) the coronavirus job retention scheme and the self-employment income support scheme are continued until 30th September 2021, and

(b) the coronavirus job retention scheme and self- employment income support scheme are continued until 31st December 2021, and the following categories of workers are made eligible for the schemes—

(i) limited company directors,

(ii) self-employed workers earning more than 50% of their income from employment, and

(iii) self-employed workers with profits over £50,000.

(3) A review under this section must consider the effects of the provisions on—

(a) employment,

(b) GDP growth,

(c) personal debt, and

(d) poverty.’

New clause 27—Review of effect on small businesses—

‘(1) The Chancellor of the Exchequer must lay before Parliament within six months of the passing of this Act a review considering the effects of this Act on small businesses that have been subject to restrictions on trading as a result of the pandemic.

(2) The review must consider the following issues—

(a) debt,

(b) rent arrears,

(c) solvency, and

(d) the ability of small businesses to employ individuals.’

New clause 28—Review of effect on carbon emissions—

‘The Chancellor of the Exchequer must lay before Parliament within six months of the passing of this Act a review on the effect of the provisions of the Act on—

(a) a transition towards zero-carbon domestic flights by 2030,

(b) any reduction in the share of the UK’s carbon emissions coming from international flight travel, and

(c) the number of individuals booking more than three international flights a year.’

New clause 29—Review of effect on supply chain and other workers—

‘(1) The Chancellor of the Exchequer must lay before Parliament within six months of the passing of this Act a review considering the effects of the provisions of this Act on the following categories of—

(a) workers, employees and self-employed individuals in the supply chain sector,

(b) employees on zero-hours contracts and agency workers, and

(c) office workers in different income deciles that have worked remotely since March 2020.

(2) The review must include an assessment with regard to—

(a) employment income, and

(b) socioeconomic inequalities.’

New clause 31—Review of section 21—

‘(1) The Chancellor of the Exchequer must review the impact of section 21 of this Act and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must consider—

(a) the impact of section 21 on levels of tax avoidance,

(b) the impact of section 21 on levels of tax avoidance if section 61O of ITEPA 2003 were amended to prohibit the operation of umbrella companies, and

(c) the impact of section 21 on levels of tax avoidance if section 61O of ITEPA 2003 were amended to mean that an umbrella company would not be an intermediary but would still be able to operate, provided that the following conditions were met—

(i) the worker had no material interest in the umbrella company;

(ii) the umbrella company received the monies from the agency and used the entire amount to process as earnings, including the total cost of employment, less a transparent intermediary margin;

(iii) at the end of the engagement, any outstanding holiday pay was paid;

(iv) all employment rights, including agency workers’ rights, were maintained; and

(v) no payment was given to any other party.’

Amendment 23, page 2, line 15, leave out clause 5.

This amendment would ensure that the thresholds for the personal allowance and for the higher rate of income tax rise in line with inflation as per the Income Tax Act 2007.

Amendment 27, in clause 15, page 9, line 16, at end insert—

“(3) The Chancellor of the Exchequer must, no later than 5 April 2022, lay before the House of Commons a report—

(a) analysing the fiscal and economic effects of Government relief under the annual investment allowance scheme and the changes in those effects which it estimates will occur as a result of the provisions of this section, in respect of—

(i) each NUTS 1 statistical region of England and England as a whole,

(ii) Scotland,

(iii) Wales, and

(iv) Northern Ireland, and

(b) assessing how the annual investment allowance scheme is furthering efforts to mitigate climate change, and any differences in the benefit of this funding in respect of—

(i) each NUTS 1 statistical region of England and England as a whole,

(ii) Scotland,

(iii) Wales, and

(iv) Northern Ireland.”

This amendment would require the Chancellor of the Exchequer to analyse the impact of changes proposed in Clause 15 in terms of impact on the economy and geographical reach and to assess the impact of the investment allowance scheme on efforts to mitigate climate change.

Amendment 28, in clause 19, page 13, line 12, at end insert—

“(3) The Chancellor of the Exchequer must, no later than 5 April 2022, lay before the House of Commons a report—

(a) analysing the fiscal and economic effects of Government relief in relation to R&D tax credits for SMEs and the changes in those effects which it estimates will occur as a result of the provisions of this section and schedules 3 and 4, in respect of—

(i) each NUTS 1 statistical region of England and England as a whole,

(ii) Scotland,

(iii) Wales, and

(iv) Northern Ireland, and

(b) assessing how R&D tax credits for SMEs are furthering efforts to mitigate climate change, and any differences in the benefit of this funding in respect of—

(i) each NUTS 1 statistical region of England and England as a whole,

(ii) Scotland,

(iii) Wales, and

(iv) Northern Ireland.”

This amendment would require the Chancellor of the Exchequer to analyse the impact of changes proposed in Clause 19 in terms of impact on the economy and geographical reach and to assess the impact of R&D tax credits on efforts to mitigate climate change.

Amendment 32, in clause 21, page 13, line 33, after “(1B)” insert “or (1C)”.

Amendment 33, page 14, line 9, at end insert—

“(1C) This subsection is satisfied where—

(a) the worker has no material interest in the intermediary,

(b) the worker—

(i) has received,

(ii) has rights which entitle, or which in any circumstances would entitle, the worker to receive, or

(iii) expects to receive,

a chain payment from the intermediary.

(c) If any of the conditions A, B or C in this subsection apply, then this exempts the person within the chain from being an intermediary.

(d) Condition A is that the services are supplied by or through a third person (“the agency”) where all income received and receivable for those services wholly constitutes employment income subject to Chapter 7 of Part 2 of ITEPA 2003.

(e) Condition B is that the worker is employed under a contract of employment within the meaning of section 230(2) of the Employment Rights Act 1996 and is ordinarily or habitually employed by the intermediary prior to being engaged by the Client, either directly or via an agency, and has been engaged by the Client on a secondment basis.

(f) Condition C is that all of the following apply—

(i) the worker is employed by the intermediary under a contract of employment within the meaning of section 230(2) of the Employment Rights Act 1996,

(ii) the worker, if engaged via an agency, has not given notice of an agreement with the intermediary that paragraphs (1) to (8) of regulation 32(9) of the Conduct of Employment Agencies and Employment Businesses Regulations 2003 shall not apply,

(iii) all income received and receivable by the worker wholly constitutes employment income from the intermediary,

(iv) the total of the payment elements paid to the worker during the entire engagement are equal to or greater than the sums of chain payments made to the intermediary during the engagement,

(v) the intermediary is not in breach of Section 54 of the Pensions Act 2008, and

(vi) the intermediary is not in breach of Paragraph 3A of Schedule 1 of the Social Security Contributions and Benefits Act 1992.

(g) A “payment element” means any of the following—

(i) secondary Class 1 National Insurance Contributions, as defined by section 6 of the Contributions and Benefits Act,

(ii) apprenticeship Levy as defined by Part 6, section 98, of the Finance Act 2016,

(iii) pension contributions, which shall mean contributions paid into registered pension schemes by their employers that are subject to the exemption provided by Section 308 of ITEPA 2003,

(iv) intermediary margin, which shall mean a fixed fee deducted from the chain payment, the amount of which has been declared to the contractor prior to becoming an employee,

(v) holiday pay, which means any amounts paid to the worker under the Working Time Regulations 1998 either during or upon termination of the engagement,

(vi) net employment income, which shall mean employment income paid to the worker after deduction of Income Tax under PAYE, Class 1 primary National Insurance Contributions, and Student Loans deductions,

(vii) allowable expenses, which shall mean any reimbursement of expenses to the worker by the intermediary permitted as per Chapter 2 of Part 5 of ITEPA 2003.

(h) In (1C)(g) “secondment” shall mean the provision of any worker by means of a resource augmentation service or temporary transfer of an official or worker to another position or employment away from their primary job with the Intermediary.

(i) Where the fee-payer, defined in 61N(2), has been provided with information from the intermediary that gives them reasonable belief that any of the Conditions A to C are met, then section 61N(5) does not apply, and the client cannot become the fee-payer under 61NA subsections (3) and (4).

(j) The amendments made by this subsection (1C) have effect in relation to deemed direct payments treated as made on or after 6 April 2022.”

Amendment 34, page 14, line 9, at end insert—

“(1C) This subsection is satisfied where—

(a) the worker has no material interest in the intermediary,

(b) the worker—

(i) has received,

(ii) has rights which entitle, or which in any circumstances would entitle, the worker to receive, or

(iii) expects to receive,

a chain payment from the intermediary.

(c) If any of the conditions A, B or C in this subsection apply, then this exempts the person within the chain from being an intermediary.

(d) Condition A is that the services are supplied by or through a third person (“the agency”) where all income received and receivable for those services wholly constitutes employment income subject to Chapter 7 of Part 2 of ITEPA 2003.

(e) Condition B is that the worker is employed under a contract of employment within the meaning of section 230(2) of the Employment Rights Act 1996 and is ordinarily or habitually employed by the intermediary prior to being engaged by the Client, either directly or via an agency, and has been engaged by the Client on a secondment basis.

(f) In (1C)(e) “secondment” shall mean the provision of any worker by means of a resource augmentation service or temporary transfer of an official or worker to another position or employment away from their primary job with the Intermediary.

(g) Where the fee-payer, defined in 61N(2), has been provided with information from the intermediary that gives them reasonable belief that either of the Conditions A to B are met, then section 61N(5) does not apply, and the client cannot become the fee-payer under 61NA subsections (3) and (4).

(h) The amendments made by this subsection (1C) have effect in relation to deemed direct payments treated as made on or after 6 April 2022.”

Government new schedule 1.

Government amendment 3.

Government amendments 7 to 22.

[Abena Oppong-Asare]

I rise to speak to new clauses 2 and 24, tabled by the Leader of the Opposition, other hon. and right hon. Friends and myself.

New clause 2 draws attention to the announcement made by the Chancellor in 2019, when he was Chief Secretary to the Treasury, on implementing a non-resident stamp duty surcharge at 3%. As hon. Members will have noted, the Finance Bill introduces a non-resident surcharge at 2% rather than 3%. In Committee, I asked the Minister why the Government had watered down that commitment; I do not believe I have received an answer. We believe that this means that the Government will lose out on about £52 million a year in revenue, which they said they would have spent on tackling homelessness and rough sleeping. Perhaps the Minister could use his closing speech to clear up any confusion. Why have the Government moved from a 3% to 2% non-resident surcharge, and what assessment has been made of the impact on tax revenues and the housing market?

I turn to new clause 24. In Committee of the whole House, my hon. Friend the Member for Ealing North (James Murray) asked the Financial Secretary to the Treasury to explain whether the Government will meet their own deadline of introducing legislation to set up a register of overseas entities by 2021. The Minister’s response was that

“the Government plan to introduce the Bill in due course.”—[Official Report, 20 April 2021; Vol. 692, c. 914.]

Since that debate in Committee of the whole House, we have had the Queen’s Speech—the Government’s opportunity to lay out their legislative plans for the year ahead. I listened carefully to that speech and read the accompanying notes, but I heard no mention of the registration of overseas entities Bill.

It is now more than five years since David Cameron first announced proposals to introduce a beneficial ownership register for UK property owned by overseas companies and legal entities. Since then, we have had more announcements, consultations and draft Bills, but still no indication from the Government of when they intend to introduce this vital piece of legislation. The failure to include it in this year’s Queen’s Speech means that it is now beyond doubt that the Government will miss their 2021 deadline.

It is worth considering what that means more broadly. First, let us look at the scale of the problem. In 2014, the National Crime Agency received around 14,000 reports of transactions that were believed to involve illicit activity. By 2020, that had risen to over 62,000 reports. Of course, the true scale of the problem is extremely hard to quantify, given the lengths that individuals and organisations go to hide their illegal activities.

In 2019, Transparency International UK said:

“The London property market is highly vulnerable to corrupt wealth flowing into it.”

Its analysis found that since 2008, £100 billion of properties have been bought in London alone by overseas companies in secrecy jurisdictions and high-risk corruption countries—both indicators for illicit wealth. In 2017, it identified that 160 properties worth over £4 billion were purchased by high-corruption risk individuals. The tidal wave of dirty money is poisoning the housing market for ordinary people. There is growing evidence that the purchase of UK property to launder illicit finance from abroad has a direct impact on housing prices. As Transparency International UK—among others—has shown, attempts to clamp down on corruption around the world have led to a rise in property prices here as illicit finance flows into the UK market to avoid detection in its home country.

This is not just about luxury properties. There is a ripple effect, where activity at the top causes a rise in prices throughout the market. As demand outstrips supply in high-value areas, buyers look out to more affordable places. This leads to a cycle of rising housing prices—my hon. Friends know this story very well. Illicit finance also distorts the supply of housing as developers increasingly focus on luxury property targeted at international investors, who have no intention of living in the properties. So dirty money, from crime and corruption abroad, is pricing people out of their local communities in cities across the country.

This has a direct effect on the housing crisis. The Government know this, of course. They have committed to act and set up a register of beneficial ownership for UK property owned by overseas entities. This would let the disinfectant of sunlight into the murky world of high-end property bought by shell companies and overseas bodies. As the Government stated:

“It is intended to act as a deterrent to those who would seek to hide and launder the proceeds of bribery, corruption and organised crime in land in the UK.”

The fact the Government are aware of the problem but are still failing to act is inexplicable.

Our new clause 24 requires the Government to review how the Registration of Overseas Entities Bill could work alongside the non-resident surcharge to mitigate the housing crisis. But what we really need is for the Government to introduce this Bill as soon as possible and begin the process of implementing this important legislation. I will end by paying tribute to the Members from across the House who have campaigned on this issue relentlessly. I know they will share our disappointment that the Government are still not taking the action that we all agree is needed. I urge the Government to correct this wrong and get on with doing what they have committed to do.

[Mr David Davis (Haltemprice and Howden) (Con)]

I rise to speak to amendments 32 to 34 and new clause 31 tabled in my name and those of other right hon. and hon. Members. The Government’s historic IR35 policy has dated from long before this Minister was in his office. Far from rationalising the collection of tax from contractors, it has created and has now unwittingly extended a wild west of umbrella companies that operate without regulation and where malpractice is rife. This malpractice has seen contractors forced to operate through non-compliant umbrella companies that maximise their profits by using sleight-of-hand tactics. This includes: misrepresenting tax thresholds; skimming off pension contributions and other payments such as the apprenticeship levy; forcing contractors to opt out of their rights as agency workers; and withholding billions in holiday pay that is legally due.

The Government policy to date has triggered the increased proliferation of mini umbrella companies. BBC Radio 4’s “File on 4” found that 48,000 of these companies had been created in the past five years. The fact that policies in this area are flawed is proven beyond doubt by the fact that HMRC is having to de-register 22,000 of these umbrella companies. The frauds involved here cost the taxpayer hundreds of millions of pounds every year in lost tax, but as well as that, the boom of these non-compliant companies means that legitimate umbrella firms are being run out of business by them. The illegitimate umbrella companies making most of their profits through appropriating funds through tax scams, withholding holiday pay, skimming from the apprenticeship levy and the like are driving those honest firms out of business. There exist comparison websites for contractors to see which umbrella company they can do best with, and of course the ones that look best to them are the ones that make them money through illegitimate mechanisms.

--- Later in debate ---

[Jesse Norman]

No, the Government have been clear that there needs to be an extension of the employment agency standards inspectorate in this area, and there may well be operational measures that HMRC needs to continue to undertake. My right hon. Friend will be aware that the Bill contains very considerable additional measures designed elsewhere in the tax system to curb the promotion of tax avoidance schemes, to improve the disclosure of those schemes and to combat organisations that would attempt to derive an unfair advantage of the kind that he has described, so we are absolutely not unaware of the importance of ensuring that people across the board pay appropriate levels of tax.

It is also worth saying that none of this really falls within the context of a Finance Bill, let alone the one that we have laid out in front of us. It is also worth saying that HMRC has used real time information in ways that were contemplated and discussed earlier in the debate in order to try to be more forward-leaning in this area. We recognise the concern and HMRC is highly active in it, but in many cases these umbrella companies do have a legitimate function, and it is important to recognise that.

I think that is it—thank you very much.

[Abena Oppong-Asare]

Once again, I thank all Members who have spoken. This has been a varied and wide-ranging debate, with Members focusing on different aspects of the Bill.

My hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier) spoke about the impact of overseas buyers buying properties in her community in bulk. My hon. Friend the Member for Hornsey and Wood Green (Catherine West) spoke about the impact that dirty money is having on her local area and how other countries, such as the USA, are using sanctions to target corrupt individuals. Both are excellent champions for their constituents, who are too often at the sharp end of the housing crisis.

[Sir Geoffrey Clifton-Brown (The Cotswolds) (Con)]

Will the hon. Lady give way?

[Abena Oppong-Asare]

I am afraid that we have to make haste.

My hon. Friend the Member for Oldham East and Saddleworth (Debbie Abrahams) spoke passionately about the impact of the Bill on poverty and public health. She is absolutely right to draw attention to the Government’s failure in this area. My right hon. Friend the Member for Hayes and Harlington (John McDonnell) spoke about the measures in the Bill that are hurting the lowest earners in our society. He has always been a champion for the lowest paid.

Other hon. Members, including the right hon. Member for Haltemprice and Howden (Mr Davis), spoke about the exploitation of workers through umbrella companies. As my hon. Friend the Member for Ealing North (James Murray) said earlier, we are extremely concerned about the Government’s approach to workers’ rights, including their broken promise to include an employment Bill in the Queen’s Speech. We also share Members’ concerns about people being forced into umbrella companies and losing rights as a result. I urge the Government to look carefully at this issue.

I thank the Minister for his answer to my question on the non-resident stamp duty surcharge. I am aware of the consultation in 2019 to seek views on the decision on 1%, which led to the 2% stamp duty surcharge. I also point out that the Chancellor made an announcement in that same year, when he was Chief Secretary to the Treasury, in relation to implementing a non-resident stamp duty surcharge at 3%, so this commitment has been watered down.

I am sure that we will return to this issue during future debates and I thank Members for the points they have raised today. I will end by returning to the issue of the register of overseas ownership. As I said earlier, the Government’s failure to introduce this legislation is extremely disappointing. We will push new clause 24 on this issue to a vote, but I beg to ask leave to withdraw the clause.

Clause, by leave, withdrawn.

New Clause 24

Review of impact of 2% non-resident surcharge

‘(1) The Chancellor of the Exchequer must review the impact of section 88 and schedule 16 of this Act on tax revenues, residential property prices, affordability of residential property, and the volume of property purchases by non-residents, and lay a report of that review before the House of Commons within six months of the passing of this Act and once a year thereafter.

(2) The review under this section must include an assessment of what those impacts would have been if the provisions in the Draft Registration of Overseas Entities Bill had been in force.’—(Abena Oppong-Asare.)

Brought up, and read the First time.

Question put, That the clause be read a Second time.