Finance (No. 3) Bill

Andrew Bowie Excerpts

2nd reading: House of Commons & Programme motion: House of Commons
Monday 12th November 2018 Commons Chamber

[Andrew Bowie (West Aberdeenshire and Kincardine) (Con)]

It is a great pleasure to speak in this debate not only to support the Bill, but to associate myself with the comments of my right hon. Friend the Financial Secretary to the Treasury, who unfortunately is no longer in his place. In his opening remarks, he mentioned some words by the late Baroness Thatcher, and on reflecting on that, it is clear to me that some things never change. From what we have heard this evening, it is clear that the Labour party would still have the poor poorer as long as the rich were less rich. As I say, it is a great pleasure to speak in the debate. I will keep my remarks brief, as many other colleagues—from across the House, I am sure—will want a chance to speak about the great things this Government have included in the Bill.

Just two short weeks ago, we heard a Budget from the Chancellor of the Exchequer, and the Bill delivers on a number of promises made in that Budget. Key among these is that this Conservative Government are cutting taxes for hard-working people and lifting the lowest paid in our society out of income tax altogether. Our increase in the personal allowance will mean that, in 2019-20, basic rate taxpayers will pay about £130 less tax than in 2018-9 and £1,205 less tax than in 2010-11, when the coalition Government came to power.

Unfortunately, as I pointed out in the Budget debate just two weeks ago, my constituents will be unable to benefit from the raising of the higher threshold, as the SNP Government in Edinburgh would rather punish the strivers and the grafters—the policemen, teachers, entrepreneurs and wealth creators—than reward them, as we do. Instead, the tax gap between Scotland and the rest of the UK is growing wider and wider, with the Scottish Government squeezing out every penny.

[Patrick Grady (Glasgow North) (SNP)]

I am sorry the hon. Gentleman is having to get used to speaking from the Back Benches again, after his tremendous turn from the Front Bench in the UK Youth Parliament, but I am sure that, if he keeps up this line of complimenting the Government, it will not be long before he is back there. Does he not accept that the reality of the progressive tax reforms agreed by the Scottish Parliament as a whole—not just by the SNP Government—is that most people in Scotland are actually paying slightly less tax than they were this time last year? [Interruption.]

[Andrew Bowie]

As is being said from a sedentary position behind me, I think the total amount of money by which somebody in Scotland will be better off, if they are below a certain level, is about £24 a year. What the SNP is doing is punishing aspiration and stopping people—[Interruption.] As is being shouted from behind me, it is gesture politics. The SNP is punishing the entrepreneurs and the wealth creators that we need to attract to Scotland, especially to the north-east of Scotland. I could go on, but I will not because I have a lot to get through.

We are hearing exactly what we heard two weeks ago from the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry)—doom and gloom. This is the politics of gripe and grievance, and SNP Members cannot even find it within themselves tonight to welcome the huge strides that we have taken in supporting the oil and gas sector since 2014. I share the frustration of the hon. Member for Aberdeen North (Kirsty Blackman) about the oil and gas sector, although I would say that that is an issue for the Department for Business, Energy and Industrial Strategy, rather than the Treasury right now. But no reference was made to the welcome given by Oil and Gas UK or indeed by individual companies in that sector for our commitment to the stable regulatory and fiscal regime that, since 2014, has made the North sea one of the most attractive basins in the world in which to invest. I think that is something all representatives from Scotland, especially from the north-east of Scotland, should celebrate and thank this Government for.

As well as slashing income tax for millions of people, the Bill will implement a number of indirect tax cuts, such as the freezing of duty rates on beer, on ciders and most of all on whisky. This is a measure that we Scottish Conservatives have lobbied on relentlessly, and it will be a great boost to our local breweries and distilleries, such as Deeside Brewery in Banchory and Royal Lochnagar at Balmoral, both of which I have the honour of representing in this place.

There are freezes to support our haulage sector—heavy goods vehicles duty will be frozen for 2019-20. I am sure the importance of this freeze to the British haulage industry will be obvious to everyone as we prepare to leave the European Union. I have a dream that one day these vehicles will be able to transport Scotch whisky, which we as a Government are supporting; Aberdeen Angus beef from farms that are championed by the Conservatives, but abandoned by the SNP; and Peterhead haddock fished from this new sea of opportunity, with us out of the common fisheries policy, being delivered by this Government, along the Aberdeen western peripheral route, if the Scottish Government ever manage to resolve the mess they have got into on that road and do so without wasting even more of Scottish taxpayers’ hard-earned cash.

[Kirsty Blackman]

If we do get this wonderful Aberdeenshire produce—it is the best in the world, I would suggest—on to lorries and they drive down to Dover but are then not able to cross the channel, what does the hon. Gentleman expect will happen to the Peterhead haddock?

--- Later in debate ---

[Andrew Bowie]

The hon. Lady has no faith in this Government to deliver a deal that is going to result in frictionless trade, and that surprises me. It surprises me that she does not have the faith that I have in this Government to deliver the deal that I think will be coming and result in frictionless trade between ourselves and the European Union, just as we have frictionless trade right now.

The measures in this Bill are exactly what the Government should be introducing to support our economy at a time when it has its fair share of challenges to overcome, but that is also rich with opportunities. For this reason, I will be supporting the Bill tonight. We are supporting aspiration, encouraging growth and creating jobs, with unemployment at its lowest level since the 1970s. We are making Britain an attractive place in which to invest, and we are helping the lowest paid.

I was struck by what my hon. Friend the Member for Cheltenham (Alex Chalk) said about speaking to the next generation. He spoke about the huge strides we have taken and about the strength of the economy since 2010. As the hon. Member for Glasgow North (Patrick Grady) mentioned, on Friday, I was privileged to address the UK Youth Parliament and listen to its Members. This Chamber was packed with enthusiastic, passionate, committed and driven youngsters. We owe it to them to leave this economy in a better state than the one in which we found it in 2010, and to create opportunities, not lumber them with debt, as the 40 unfunded spending commitments made by the Opposition since the general election would do.

Quite frankly, Labour Members should be ashamed of themselves for the reckless way in which they trot out commitments without recognising that we have to pay for them and the damage that they would reap on the next generation. I am proud to support a Government who are refusing to do that and who, with this Bill, are committed to helping the working people of this country. This is the party of the working people of this country—all of this country—and I am proud to give the Bill my support tonight.

Finance (No. 3) Bill

Andrew Bowie Excerpts

Committee: 2nd sitting: House of Commons
Tuesday 20th November 2018 Commons Chamber

[Kevin Foster]

I am very grateful. I am sure that a student of divinity is about to fire off an email to me and my hon. Friend saying, “Actually, I am not quite sure that that is the case,” but it is great to hear my hon. Friend’s explanation of how the “three in one” in the case of water could apply to the Holy Trinity. Nevertheless, a detailed unpacking of the Holy Trinity is not listed for consideration on today’s Order Paper, and I should be talking about anti-avoidance measures—[Interruption.] I am glad to hear that the hon. Member for Bootle (Peter Dowd) thinks that the former would be more interesting. I am sure that at some point he will accuse me of giving a sermon in this place, although I will probably not be covering that subject at the time.

My hon. Friend the Member for South Suffolk rightly pointed to the measure in which intangible property was defined. It is also worth while for us to consider some of the exemptions, and how their working will be monitored by the Treasury. I am conscious that the Minister is not present, but I am sure that those who are currently on the Treasury Bench will note my remarks.

Proposed new section 608J states:

“Section 608A does not apply in relation to a person for a tax year if the total value of the person’s UK sales in that tax year does not exceed £10,000,000.”

How will we make sure that we do not suddenly see lots of taxed persons with £9,999,999.99 who seem to know each other quite well, or at least seem to be engaging in similar activities? I understand that the provision is well intentioned, and I understand the need for a de minimis level so that we target the larger companies that are intended to be deal with. I also understand—this takes me back to the intervention from my hon. Friend the Member for Redditch—that smaller companies should not suddenly be burdened with having to deal with a very large piece of legislation. However, I should like to know how we can ensure that this does not become a way of avoiding tax.

Proposed new section 608L, which is on page 187 of the Bill, is entitled “Exemption where foreign tax at least half of UK tax”. Again, how can we be sure that that taxation provision is genuinely met so that it does not become an avoidance mechanism?

Most of the changes in the Bill are welcome, however. As we leave the European Union, I would expect that we will still seek to co-operate. I do not think any of us would argue that it would make sense for us not to ensure that we share information to prevent the excessive avoidance or evasion of taxation, just as we have sought to work with jurisdictions such as Liechtenstein, which is not in the EU but has a treaty agreement with us on sharing information to prevent tax avoidance. I am also interested in following the consultation on the digital services tax, which will consider how we can introduce it without snuffing out the entrepreneurialism that we wish to see.

I am conscious that I have detained the Committee for about 19 minutes—[Hon. Members: “More!”] I hear the requests from SNP Members, who are obviously keen to hear a lot more from me, but, sadly, I must disappoint them on this occasion.

This has been a worthwhile debate. Intangible property is a key area for the future, in terms of not just the straight issue of ensuring that one or two large corporations are not avoiding tax we might think that they are due to pay, but opening up the whole debate of how we arrange tax as we move into a digital economy, when we are less likely to have physical things we can put our hands on in respect of taxable activity.

[Andrew Bowie (West Aberdeenshire and Kincardine) (Con)]

The shadow Minister claimed earlier that our Chancellor has said that he wants to make the UK into a tax haven. For the sake of clarity and for the record, has my hon. Friend ever heard the Chancellor say that?

[Kevin Foster]

I have certainly heard my right hon. Friend the Chancellor talking about ensuring that Britain has competitive tax rates, that Britain is a competitive and good place to do business, and that we have a fair balance between raising taxation to pay for our public services and also ensuring that our tax system encourages rather than stymies economic activity in this country.

We heard earlier about the reactions of the EU27. I would point to the Republic of Ireland, which has a lower corporation tax rate than us. If we were to move towards the Republic of Ireland’s rate, it would be somewhat strange for it to say, “How dare you copy us.” This is not about encouraging a tax competition. States in Europe, whether they are inside or outside the EU, will look to provide the conditions for growth in their countries, and it is absolutely right that that is what the Chancellor and Treasury team in this country are looking to do. I certainly praise them for that. This is not about becoming a tax haven, although we might reflect on the fact that, judging by the actions of the Scottish National party and the Scottish Government, they are trying to turn England into a tax haven by shoving up tax rates in Scotland.

With that, I will draw my remarks to a close. I welcome what I see in this Budget. I do not think that the Opposition amendments and new clauses are necessary, for the reasons the Minister outlined at the Dispatch Box. This welcome Bill will bring in more tax, deal with avoidance and, at the same time, help to push our economy forward.