Finance (No. 2) Bill (Fifth sitting)

Debate between Abena Oppong-Asare and Richard Thomson

Committee stage
Tuesday 11th January 2022 Public Bill Committees

[Abena Oppong-Asare]

I thank the Minister for her explanation of clause 99, which introduces schedule 16, which concerns emissions certificates for vehicles. When purchasing a car, capital allowances are in part determined by the level of CO₂ emissions. A 100% first-year allowance is available for new cars that have zero CO₂ emissions, including electric cars. Otherwise, writing down allowances are available at the main rate of 18% per annum for electric cars and those with low CO₂ emissions—up to 50 grams per kilometre driven—or 6% per annum for those with emissions exceeding 50 grams per kilometre. The measures in the clause allow for greater CO₂ emissions figures to be used for purposes of capital allowances, taxable benefits arising from provisions of cars and vehicle excise duty. For that reason, we will not oppose the clause.

[Richard Thomson]

Thank you, Sir Christopher, for your opening comments on this group. My party does not get too many advances or victories in this place, so it is important to savour them when we can. I will certainly savour this one. I have a sense of clairvoyance about what the Minister will say in response.

We fully support the intention behind schedule 16. It is important to have the certification regime in place. However, as I argued when discussing the SNP’s new clause 5 in the previous group, it is important not only that consumers have confidence in the figures that are published, but to understand the impact that their publication has on behaviour. When we discussed new clause 5, we talked about the very incremental changes to vehicle excise duty, and my party proposed that we should look at the impact of those on consumer behaviour. Similarly, we feel we must understand how emissions certification changes consumer and manufacturer behaviour.

As a fundamental point, when we are as engaged in trying to achieve net zero as all Governments in these islands say that they are, it is important that Government have clear oversight of how spending and taxation influence behaviour in driving movement towards net zero. This measure should be no exception, and that is what our new clause seeks to achieve. In the fairly safe assumption that it will not be accepted by the Government, I would like to know how they intend to monitor how the changes drive behaviour.

Finance (No. 2) Bill (Fourth sitting)

Debate between Abena Oppong-Asare and Richard Thomson

Wednesday 5th January 2022 Public Bill Committees

[Richard Thomson (Gordon) (SNP)]

I rise to speak to new clause 11. For far too many people, gambling is not something that falls into the category of harmless fun. There are many harms associated with gambling. There are the financial harms, obviously, when someone’s luck is not with them. There are the short-term harms and the harms of long-term debt. There are the addictive and compulsive behaviours associated with gambling. There is the harm to individual wellbeing in terms of mental and physical health, and to the friends and families of those engaged in the harmful behaviours associated with gambling.

To get to the nub of it, duties are obviously charged on casino gaming products, but there are also social responsibilities on those who provide such experiences. Frankly, in deciding the balance in terms of where tax is levied, we need to be able to assess the impact and volume of gambling and its wider impact on public health. That is what new clause 11 would do. We do not intend to push it to a vote, but the Government need to be mindful of this issue, and they should assess and have the evidence basis for the changes that they make, so they can set appropriate policy in the future, for all the reasons I have outlined.

[Abena Oppong-Asare]

The SNP has tabled new clause 11 on the volume of gambling and public health, and I think there was a similar proposal last year. It is interesting to compare the uprating of these bands, to prevent casinos from paying more tax simply as a result of inflation, with the Government’s decision to freeze the income tax personal allowance, which of course increases the tax ordinary people will pay as a result of wage inflation. Perhaps the Minister would like to comment on that.

I also want to say a little about gambling harm and the Treasury’s role in tackling it. The Minister will be aware of the recent report by Public Health England on gambling-related harms. PHE estimated that the annual economic burden of harmful gambling is approximately £1.27 billion. It is estimated that £647.2 million of that is a direct cost to Government. In the Government’s consultation on the review of the Gambling Act 2005, they asked about

“the most effective system for recouping the regulatory and societal costs of gambling from operators, for instance through taxes, licence fees or statutory levies”.

What progress has the Treasury made on that? Is it considering a new tax or levy on the industry to pay for the social costs of gambling? If so, does it intend to bring such a measure forward?

Finance (No. 2) Bill

Debate between Abena Oppong-Asare and Richard Thomson

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

[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.