Taxation (Post-transition Period) Bill

Debate between Alison Thewliss and John Redwood

3rd reading & 3rd reading: House of Commons
Tuesday 15th December 2020 Commons Chamber

[John Redwood]

Indeed. I think my hon. Friend has confirmed that under the previous Prime Minister, when those of us who could not vote for her agreement said that we needed a sovereignty escape clause, we were told that that would not be permissible because it would not be effective implementation of the agreement; which was then reassuring to us, not liking the withdrawal agreement very much and realising that it was a provisional agreement and would be completed only were there to be a satisfactory outcome to the total range of talks. It was a totally artificial constraint that the EU invented that it had to be sequenced, when up until that point everybody had always rightly said that nothing was agreed until everything was agreed.

I would like to hear from the Minister a little more explanation on the detail of the Bill. As I understand it, the Northern Ireland protocol would apply only to goods that are passing from Great Britain to Northern Ireland and then on to the Republic of Ireland, or the reverse—goods coming from the Republic to Northern Ireland and then passing on to Great Britain. Am I right in thinking that that is a very small proportion of the total trade? In what ways will the Government ensure that it is properly defined, so that we do not catch up most goods in those more elaborate procedures? The bulk of the trade will be GB to Northern Ireland and back, or Republic of Ireland to Northern Ireland and back, and it should not in any way be caught up in any of these proposals. I am not sure that we do have a de minimis way of dealing with the so-called things at risk.

It is not clear how the system will work for items at risk where we agree that they are at risk—and I hope it is a UK decision about what is a risk, not some other kind of decision with EU inspectors. It would be helpful to me and the wider community interested in this debate to know how a business would proceed if it had such a good at risk, to whom it would answer, and what decisions would be made about such a good in Excise, because it sounds a rather complicated and difficult arrangement, both for the business concerned and for those who are trying to enforce.

I am trying to tease out from the Minister, in pursuit of the interests of my hon. Friend the Member for Stone and myself on sovereignty, whether we are really in control if the trade has started off from GB and is going to Northern Ireland. What kind of external intervention can the EU or the Republic of Ireland engineer—how is that fair, and how will it be determined? I think that is what we are most worried about in this piece of legislation, and we would be more reassured if there were the override that my hon. Friend proposes. I should be grateful for some explanation.

[Alison Thewliss (Glasgow Central) (SNP)]

I come to this debate with many of the same concerns as I had last week. I shall not repeat them because I think everybody is quite clear on what they were. We come to this debate with the clock ticking louder and louder, and with uncertainty ahead.

I must agree with the right hon. Member for Wokingham (John Redwood) when he says that this is a complex, complicated and difficult arrangement. Yes it is, and it is absolutely baffling why we are still not certain what will happen, with such a close deadline looming. It is impossible for businesses to know what to plan for and how they will manage this, because so much is still uncertain. The Institute for Government’s Jess Sargeant went through some of the outstanding issues in the Northern Ireland protocol still to be agreed, and these are not small things but quite significant things in many cases. There is still great uncertainty about the grace period that was talked about last week, what will happen at the end of it, and what the Government are going to do between then and now, whenever this finishes. What work will they be doing in the meantime? It does feel, quite often, that this Government put things off and leave things, and then say, “Oh gosh, suddenly I have to do that at the last minute.” They do that quite regularly.

Taxation (Post-transition Period) (Ways and Means)

Debate between Alison Thewliss and John Redwood

Ways and Means resolution & Ways and Means resolution: House of Commons
Tuesday 8th December 2020 Commons Chamber

[Alison Thewliss]

The EU has done everything it can because it knows it is everybody’s interest to have a deal.

[John Redwood]

Will the hon. Lady give way?

[Alison Thewliss]

I will make some progress and bring the right hon. Gentleman in later on. It is interesting that Tony Connelly from RTE said that the EU nations are watching closely to ensure that the relevant clauses are effectively withdrawn from the Bill. If I were them, I would be looking very dubiously at the UK Government on that issue, because we do not know what is going to happen.

It is quite surreal to prepare for a Bill that we have not yet seen, and from which clauses that do not yet exist could still be removed or added, after being rubber-stamped by the House. The six ways and means resolutions on one side of A4 paper represent a significant volume of very detailed VAT resolutions. Resolution 6 alone refers to a Commission decision that runs to some 39 pages on the treatment of CFC group financing exemptions to state aid, and there is still no detail on specifically how the Government wish to amend the substantial pieces of taxation legislation.

We would have advance notice of a Finance Bill, for example. We would have Second Reading, Committee, and Report over an extended period. That time would allow evidence and engagement with stakeholders, but that is not so with these resolutions. To take an example, the Finance Bill earlier this year contained a solid five and a half pages on the detail of call-off stock arrangements. We debated them in the Bill Committee at great length, and it was tremendously exciting.

[John Redwood]

Will the hon. Lady give way?

[Alison Thewliss]

If the right hon. Gentleman can tell me something about call-off stock arrangements and what the Government are proposing, I will let him in.

--- Later in debate ---

[John Redwood]

I would like to know why the hon. Lady supports the EU position on everything. On the question of fish, does she support the general EU smash-and-grab raid for most of the fish, or does she prefer the French version, which is to take practically the whole lot?

[Alison Thewliss]

I would prefer it if the Government would listen to the concerns of west coast fisheries in Scotland that do not want their fish to die and rot in lorries at Dover because the Government have not sorted out the trading customs.

Members of the House are expected to scrutinise the new tax regime in a fast-tracked timetable with no time for debate or consultation with businesses. There are a host of details in the VAT resolutions. I went through them this morning. I copied them and pasted them, and took them from the VAT regulations that currently exist. That runs to some 20 pages of detail on those VAT resolutions. [Interruption.] I can see the hon. Member for Thirsk and Malton waiting for me to read through those 20 pages, but I am not going to do that. I will send him a copy if he would like to read it over later. We will certainly be further forward than we are with the Government concluding anything.

There is a lot of detail in the resolutions and we need to know what exactly is going to happen with them.  There are issues on penalties relating to VAT in the Taxation (Cross-border Trade) Act 2018. There are issues to do with the importing of goods as well, and how that is going to work. The guidance on the resolution

“Value added tax (online sales by overseas persons and low value importations)

That provision may be made for the purposes of value added tax in cases involving—

(a) supplies of goods by persons established outside the United Kingdom that are facilitated by online marketplaces, or

(b) the importation into the United Kingdom of goods of a low value.”

runs to 11 pages on the UK Government’s website. There are 11 pages of detail, but we do not know what the Government are proposing to change here. We do not know what the Government are proposing to do here and that is very unfortunate. The issue really does follow on from that: we do not know what the Government are going to do and we do not have adequate time to scrutinise all the papers and see what is in them. We do not know whether the Government’s drafting will actually work, when it has been done in such haste.

--- Later in debate ---

[John Redwood]

The answer is that I campaigned for this Parliament to take control and use it in the interests of the people, which is why I am making the speech that I am making. Why does the hon. Gentleman not listen to it instead of planning an intervention for a speech I am not making? I am urging the Government to take back control and use it in the way that the public would like to see them use it.

I must take up the point of sovereignty. My hon. Friend the Member for Stone (Sir William Cash) is quite right to go back to that. The simple truth about Brexit is that Brexit voters knew exactly what we were voting for. We understood the slogan “Take back control”, and we think control—the right of self-government, the right to trust people in these Houses of Parliament to make decisions for us or the right to throw them out if they are useless—is fundamental to our freedoms and living in a democracy. You do not bargain those away in some kind of dispute about tariffs. You do not argue about those in the context of making compromises.

This is the fundamental truth of Brexit. Like practically every other country in the world that is not a member of the EU, we just want to be free to make those decisions and laws that we can make and have representative institutions—a great Parliament—in order to do that. We clearly need to train some of the parliamentarians in the idea that we can make better laws here than people can make for us abroad and that we can modify European laws that we currently have so that they work in our interests better.

[Alison Thewliss]

Does making better laws not start with letting MPs see a Bill before it exists?

[John Redwood]

I do not disagree with the hon. Lady. I have said that I want to debate a real Bill. I am giving ideas to the Minister because I do not think what he has in mind for this Bill is going to quite suit me. I want to pep it up. I want to make it more exciting so that we can go out to the public and say, “This is the party that is going to level up. This is the party that knows how to recover an economy that has been damaged by covid”, and that requires lower taxes and different taxes and requires that we use the powers that only the House of Commons has. The House of Lords has very limited abilities to intervene, and on this occasion I am very pleased about that, because it nearly always wants to take the European answer, and the European answer is the high unemployment answer, the high taxation answer and the very complicated taxation answer.

VAT is an extremely complicated tax. We had to adopt its complications and we are now trying to add to those complications to try to avoid items slipping through. We are trying in these proposals to deal with small transactions that sometimes escape the net. They try to find ways of making online organisations, for example, responsible for levying tax between two people trading with each other.