Turkish Incursion into Northern Syria

Debate between Anne Main and Dominic Raab

Tuesday 15th October 2019 Commons Chamber

[Mrs Anne Main (St Albans) (Con)]

My good friend, my hon. Friend the Member for Harrow East (Bob Blackman), makes exactly the right point. I wish to restate that it is totally unacceptable that any refugee could be used as a bargaining chip. Can we have a strong, united statement across Europe, if needs be, to say that that is the case? There are other refugee camps, such those with the Rohingya, where, if sheer volume of numbers gives any country the right to use them as a bargaining chip, we will go down a very slippery slope. I understand the sensitivities over Turkey and the sheer volume of numbers, but it is important that internationally, we say that refugees have rights and no country has the right to have some control over their destiny in that way.

[Dominic Raab]

My hon. Friend is absolutely right. If she looks at the Foreign Affairs Council conclusions from Monday, she will see that the EU gave a very clear message on that. It is a violation of international law to treat refugees in that way. It is totally unacceptable, particularly among allies and friends.

Oral Answers to Questions

Debate between Anne Main and Dominic Raab

Tuesday 3rd September 2019 Commons Chamber

[Dominic Raab]

My hon. Friend is absolutely right. Any violence is deplorable. It should not be conducted in this country, or anywhere else for that matter, against any individual communities. We now need to try to reduce these tensions but also, on a positive side, to build confidence-building measures to allow proper dialogue between the communities in Kashmir but also between India and Pakistan.

[Mrs Anne Main (St Albans) (Con)]

I have met my Pakistani and Indian communities, who are very concerned about the Kashmir situation. The revocation of article 370 of the Indian constitution without involving the Kashmiri people was particularly heinous. If Amnesty International is to be believed, and I think it is, we should have learned from the Rohingya crisis to know that this is another crisis emerging now. We must take the firmest steps to condemn it and do what we can.

[Dominic Raab]

We are aware of the implications of the revocation of article 370, which has caused interest and concern not just within India and Pakistan but among communities throughout the UK and internationally. It is a bilateral issue for India and Pakistan but also an international issue, given the human rights at stake.

European Union (Withdrawal) Act

Debate between Anne Main and Dominic Raab

Tuesday 15th January 2019 Commons Chamber

[Dominic Raab (Esher and Walton) (Con)]

For my part in this debate, I have always understood the case for compromise, but compromise cannot come at any price, and the deal before us involves the most severe and enduring risks to our economy and our democracy while stifling the opportunities of Brexit that fired up over 17 million people with the optimism and the hope to vote in June 2016.

My reasons for my decision are straightforward. First, the Northern Ireland backstop and the scale of separate “regulation without representation” is undemocratic and a threat to our precious Union. Secondly, the UK-wide customs backstop has morphed into a hybrid customs union and single market arrangement, where the combination of alignment and non-regression requirements prevent this House from determining the right laws in the best interests of this country.

[Mrs Anne Main (St Albans) (Con)]

Does my right hon. Friend agree that the backstop is, as the Attorney General said, taking a risk with the Good Friday agreement and the Union of this country, and that is a risk that many of us are not prepared to take?

[Dominic Raab]

My hon. Friend is absolutely right, and on top of that powerful point the effect of this deal is to give up control, and it would precipitate a democratic cliff edge. That is compounded by the lack of an exit mechanism we can control. It gives the EU a veto over any UK exit from the backstop, even if negotiations on the future relationship languish for years or break down entirely. It is clear that none of the subsequent assurances alter the legal position as set out in the withdrawal agreement.

Brexit Negotiations and No Deal Contingency Planning

Debate between Anne Main and Dominic Raab

Tuesday 4th September 2018 Commons Chamber

[Dominic Raab]

I thank the right hon. Gentleman, who is of course absolutely right in his technical remarks and also, I fear, about the fact that some—not all, but some—are trying to politicise the issue. I do think that there are legitimate issues. We have committed to giving effect to the joint report that we agreed with the EU, but it is certainly true that some are trying to use the issue as leverage, and that will not work.

[Mrs Anne Main (St Albans) (Con)]

In his remarks on a no deal scenario, my right hon. Friend said that while we are mindful of our legal obligations, there would be a swifter end to our financial contributions to the EU. For my sins, I have spent the summer in my office trying to find more detail about the EU budgetary spend and what exactly the EU has been doing with taxpayers’ money. If we get into a position of no deal, could there be some degree of oversight? I am not prepared to write a cheque just because the EU says that we owe a certain amount if we are unaware of exactly how that money has been allocated and spent.

[Dominic Raab]

My hon. Friend is absolutely right to be scrutinising line by line how UK and other European countries’ taxpayers’ money is spent. We have been very clear that there is no deal until we get the whole deal—and, of course, that includes the money.

Human Rights Framework: Scotland

Debate between Anne Main and Dominic Raab

Wednesday 2nd March 2016 Westminster Hall

[Mrs Anne Main (in the Chair)]

Order. It is usually customary to let the Minister respond to the question being asked.

[Mr Raab]

I am happy to give way, but if we have a Gatling gun salvo of interventions, that rather eats into my time and opportunity to address such matters. I will, however, give way to the hon. Gentleman, as it is his debate.

Stamp Duty Land Tax

Debate between Anne Main and Dominic Raab

Thursday 4th December 2014 Commons Chamber

[Mr Dominic Raab (Esher and Walton) (Con)]

It is a pleasure, as always, to follow my hon. Friend the Member for Nuneaton (Mr Jones), who made a range of important points in typically common-sense language.

I, like others, welcome the Chancellor’s autumn statement. Like business rates reform, which is another aspect I wholeheartedly welcome, a major overhaul of stamp duty is long overdue. I pay tribute to my hon. Friend the Member for St Albans (Mrs Main), who has conducted a tenacious campaign for major substantive reform of stamp duty. If the experience of our hon. Friend the Member for Harlow (Robert Halfon) is anything to go by, she will shortly be elevated to a senior rank. I am sure she will be thrilled by that.

I am delighted that the Chancellor is taking action against what was one of Labour’s most arbitrary stealth taxes. The way it operated was a pretty vindictive assault on aspirational low and middle-income savers. The point has been made that, economically, a well functioning housing market should enable people to engage in mutually beneficial transactions, and make efficient use of housing stock. That is extremely important. A family in a small house should be able to move to a larger one, if they need to do so because of a growing family or if someone is earning more following a promotion. Older couples should be free to downsize when they want, not least to free up cash for other needs. Stamp duty has been a poorly designed tax that has undercut social mobility upwards and downwards.

In my constituency, we have felt that burden disproportionately. Of course, there are many families living in Elmbridge who are on very high incomes, but that does not mean that across the board it is some kind of land of milk and honey. For many of the residents whom I come across, their home is a nest egg built up after many years of saving. They may be asset-rich but income-poor. They may want to downsize to release cash for income or even the costs of care. Stamp duty has had a totally arbitrary impact on them. We also have a problem with key workers, who are vital for the delivery of local public services. They find it unaffordable to live locally and stamp duty has exacerbated that problem.

Above all, we have a wide range and large number of middle-income families, working hard, saving and facing very high cost of living pressures, and affordable housing is a major factor. As of the second quarter of last year, the median house price in Elmbridge was £445,000. That price has almost certainly risen substantially since then, but it does not buy a mansion. I can say that as someone who lives in my constituency. Typically that price would buy a two-bedroom home, which under the old regime would land the buyer with a massive stamp duty bill of over £13,000. According to the most recent market data, a family in a small home looking to buy a larger one would be left facing a bill of £13,000 or more for the average two-bedroom property, and £23,000 or more for the average three-bedroom home.

The cumulative bill is staggering. In 2012-13 my constituents paid £56 million to the Exchequer in stamp duty on residential property, which is more than the total paid in the whole of the north-east of England and a third of the figure for the whole of Scotland. Of course, Esher and Walton is just one area, and there are obviously geographic differences in incomes as well as house prices, but they do not necessarily match up, and they certainly do not tally neatly or consistently in my constituency. Elmbridge is just one example of stamp duty’s geographical unevenness. London accounted for 41% of residential stamp duty in 2012-13, and the south-east of England accounted for a further 22%. England as a whole accounted for 94% of UK stamp duty. It therefore has a very particular geographical burden, and it is not filtered according to income.

Stamp duty is not an economically efficient tax, as we have heard time and again. Stamp duty on residential property distorts the whole structure of the housing market. In particular, the slab structure, under which the relevant rates apply to the full sale price, not just the part above the relevant threshold, has created huge cliff edges, as we have heard this afternoon. It is worth dwelling on the impact of the slab structure. I think that the Chancellor made the point exceptionally well yesterday. A £1 increase in the price of a home, from £249,999 to £250,000, triggers an extra £5,000 tax liability. That cliff edge has been shown to be harmful to home owners and would-be buyers. It is worth remembering that stamp duty is a tax on transactions, so it impacts on the purchaser and the seller.

Property experts London Central Portfolio, together with the Cass business school, have put together an analysis that estimates that close to 14,000 home owners a year are forced to reduce the asking price for their home in order to get under a stamp duty threshold. Other would-be sellers are either unable or unwilling to reduce their prices to below the nearest threshold. That causes bottlenecks in the market and a drought of available properties in certain price ranges in certain areas, which is very harmful to the market and has important social as well as economic impacts.

It is little wonder that the Institute for Fiscal Studies has described stamp duty as

“a strong contender for the UK’s worst-designed tax”,

with a “perverse” and “absurd” structure. The director of the IFS argued earlier this year that in the modern era of broadly based taxation, the case for maintaining stamp duty at all is “very weak indeed”.

[Mrs Main]

I pay tribute to my hon. Friend, who along with me secured the stamp duty debate in September and who has raised these matters on numerous occasions in the media. Does he share my concern that that debate was very poorly attended by the other parties? Indeed, it was very much Members on the Government side who were concerned about the matter.

[Mr Raab]

My hon. Friend, as usual, makes her point powerfully. As is so often the case, the real democratic debate and scrutiny is taking place on this side of the House, but at least the Labour party accepts these changes. I hope that in due course it will reflect and put paid to some of its ridiculous notions about a mansions tax, which is really about the politics of envy, rather than sensible economics or social fairness.

I want to move on to the impact of stamp duty, because it has also proved socially unfair. When the additional 3% and 4% rates were introduced in 2000, they were designed for the wealthy. Had the threshold risen in line with house price inflation, only properties worth £1.3 million would attract 3% stamp duty today. The Chancellor’s reforms will make a vital difference and I fully support the direction of travel. The move from the slab structure to marginal rates is far more economically efficient. It will unblock bottlenecks in the market, which also have a negative effect on housing supply and stock. I wholeheartedly welcome this move.

Likewise, I recognise that the vast majority of home buyers, and as a result sellers, will benefit. The tipping point at which buyers will pay more as a result of the reform kicks in at just under £940,000. I have two points to make about that. First—this relates to my earlier point about house prices varying dramatically across the country—there are plenty of three-bedroom homes in my constituency, as I am sure there are in London and in other constituencies, that will already be caught by the new system and will end up paying significantly more. They are not mansions owned by the super-rich; many are owned by people who have saved and so are asset-rich but income-poor. Again, London and the south-east will feel the burden. I do not think that we can always assume that it will hit only those with the broadest shoulders; it will also hit those who have saved and planned their finances over the long term, and it will have a significant impact.

Secondly—this is the missing piece of the jigsaw—given the forecasts for house price inflation, buyers of average-priced homes in many parts of London and the south-east will in a relatively short time find themselves paying substantially more. Over time, the higher rates will, by stealth, hit more and more middle-class buyers and sellers. In London and the south-east, median home buyers could be caught by the new 10% rate within 10 years, depending on how the forecasts for house prices turn out. To be clear, that means that within a decade—more or less—average home buyers could be hit by the 10% rate. Recent experience with the 3% and 4% rates of stamp duty under Labour shows that what starts as a tax aimed at the rich, within a relatively short period of time if we are not very careful ends up clobbering the middle classes. I hope that in the immediate or not too distant future Ministers will address that point square on by indexing the thresholds for all rates to house price inflation. That way, we can learn the lessons and avoid the mistakes of previous Labour Governments.

If we do not address fiscal drag now, and instead kick it into the long grass, we risk ending up over time robbing middle-class Peter to pay working-class Paul, and I do not think that we should be engaged in that, as a matter of sound economics, social fairness, or indeed long-term sustainable politics. Instead, we should be ensuring, as part of our long-term economic plan, that over the long term all low and middle-income aspirational savers and home buyers benefit from these important and welcome reforms.

Stamp Duty (Housing Market)

Debate between Anne Main and Dominic Raab

Thursday 4th September 2014 Westminster Hall

[Mr Dominic Raab (Esher and Walton) (Con)]

It is a great pleasure to serve under your chairmanship, Mr Betts, I think for the first time. I congratulate my hon. Friend the Member for St Albans (Mrs Main) on securing this important debate with her characteristic tenacity. I can only reinforce the compelling arguments she has made, which I am sure will be conveyed to the Chancellor through Treasury Ministers and Parliamentary Private Secretaries. I hope that that will result in further action on this important issue.

I start on the key point of principle of economics: a well functioning housing market should enable people to engage in mutually beneficial transactions and make efficient use of existing housing stock. We know that we have a problem with the supply of housing stock, which is all the more reason to make the best use of the stock we have. I pay tribute to the coalition for its efforts to increase the overall housing supply and, in particular, the supply of affordable housing.

What does that principle mean for the average person? A family in a small house should be able to move to a larger one, if they need to or if they have a growing family, or because of a promotion from working harder. Older couples should not be forgotten. They want to be free to downsize when and how they want, not least to free up cash for other needs. They might want to go travelling, if they are in good health. They might want or need to use the money for care, or they might want to realise some of the value from their assets and free up some money from them. We should not be creaming money off people with those real social needs. The key point is that stamp duty is a poorly designed tax that undercuts that type of social mobility in both directions.

Further to what my hon. Friend said, I have all sorts of horror stories from my constituency, where we feel the disproportionate burden of stamp duty. Some families in Elmbridge are on very high incomes, but overall, looking beyond the small minority who are doing incredibly well and are very affluent, the truth is—I see this day to day, week to week and month to month—that it is no land of milk and honey. The vast majority are hard-working people on low and middle incomes. We also have pockets of acute deprivation and, in particular, as I alluded to, elderly deprivation. For many residents, their home is a nest egg that has been built up after years of saving. They may be asset-rich in statistical terms, but they are income-poor. They might want to downsize or need to release the cash for income or the cost of care, and stamp duty has an utterly arbitrary impact on them.

As my hon. Friend said, many key workers in local public services simply find it unaffordable to live locally, and stamp duty exacerbates that problem. Above all, I want to take time to speak out as a voice for the many people in low and middle-income households. They are working hard and facing high cost of living pressures, of which affordable housing is a major factor. As of the second quarter of last year, the median house price in Elmbridge was £445,000. That does not buy a mansion. Typically, it fetches a nice, but relatively modest-sized, two-bedroom home. According to market data, a family in a small home looking to buy a larger one would face a bill of £13,000 on the average two-bedroom property and a bill of £23,000 on the average three-bedroom home.

[Mrs Main]

Is my hon. Friend as concerned as I am about families growing up in cramped environments? What space is there for children to study? There is a direct correlation between people living in cramped conditions and achievement in life. If we are not allowing people to move up, that could be part of the problem.

[Mr Raab]

My hon. Friend has made a typically astute point. The problem has a social impact as well as an economic one. Let us remember that stamp duty costs are on top of the tax on income, the money that families scrape together for a deposit, the legal fees, which are increasingly high, and the money for a survey. The cumulative bill in my constituency is staggering. To give a sense of the big picture, for 2012-13, residents in my constituency paid £56 million to the Exchequer in stamp duty on residential property. That is more than the total paid in the whole of the north-east of England. I am not trying to set off some sort of north-south divide, but at some point in the debate on the redistribution of wealth, there needs to be some recognition that it is not just the uber-wealthy and the super rich who are paying the burden; it is middle England, the middle classes and those on relatively low and middling incomes.

The amount of stamp duty paid in my constituency is equivalent to a third of the figure for the entirety of Scotland. Frankly, in constituencies such as mine, stamp duty feels like an assault by the taxman on hard-working, middle-income savers, who are precisely the people we should be incentivising, not walloping—I would have said “clobbering”, but my hon. Friend has used that word. Of course, Esher and Walton is just one example of the geographic unevenness of stamp duty. London accounted for 41% of residential stamp duty last year, with the south-east accounting for a further 22%. England as a whole accounts for 94% of UK stamp duty. The tax clearly has an arbitrary effect in different areas of Britain.

More broadly, the tax is not economically efficient. If we look at the raw economics—I know my hon. Friend the Member for Harlow (Robert Halfon) and the Minister care deeply about economic efficiency—we see that it is an inefficient tax. Stamp duty on residential property distorts the whole structure of the housing market. My hon. Friend the Member for St Albans has mentioned the slab structure, under which the relevant rates apply to the full sale price, not just the part above the relevant threshold. That creates huge cliff edges. A £1 increase in the price of a home, from just under £250,000 to just over, triggers an extra tax liability of £5,000. The cliff edges have been shown to harm both home owners and would-be buyers. After all, why would someone put an offer in for a property at £255,000, when for the extra £5,000 in bricks and mortar, they would pay more in stamp duty? They would not—no one does, and the data from all the estate agents bear that out.

Data on the distribution of transactions show that most buyers are simply unable or unwilling to meet asking prices just above the £250,000 threshold, because of the extra £5,000 penalty in stamp duty. As a result, the property experts London Central Portfolio, together with the Cass business school, has estimated that 13,800 home owners a year are being forced to reduce the asking price of their house to get under a stamp duty threshold. Other would-be sellers are either unable or unwilling to reduce their prices to below the nearest threshold. That causes bottlenecks in the market and a drought of available properties in certain price ranges in certain areas, until market prices rise far enough to justify the additional stamp duty, which takes a while. That deters buyers and sellers and reduces labour mobility, as my hon. Friend pointed out, because people are discouraged from moving to where suitable jobs are available, which damages the economy as a whole. It is little wonder, therefore, that the Institute for Fiscal Studies has described stamp duty as

“a strong contender for the UK’s worst designed tax”,

with a “perverse” and “absurd” structure. The director of the IFS argued earlier this year that in the modern era of broadly-based taxation, the case for maintaining stamp duty is “very weak indeed”.

However, it is not just the economic distortions and inefficiencies that we should care about. Frankly, Government Members have perhaps been a bit too defensive about coming out and saying squarely, as my hon. Friend has, that this is socially unfair and wrong. That is illustrated by the data from my constituency and the impact of the 1% rate, let alone the 3% rate. Take a family—a two-salary couple who both earn £15,000 a year—who are mortgaged to the hilt to buy a property. The usual limit, which is strictly enforced, is debt at four times joint salary. They have scraped together the money for a 10% deposit, and that way they can buy a property at £150,000. Why should they pay £1,500 extra in tax at that point? It is just a penalty. It might seem like a small percentage of the price of the property, but for families on tight margins, working hard, it is utterly punitive.

When the additional 3% and 4% rates were introduced in 2000, they were designed to target the wealthiest, and had the original threshold for the 3% rate risen in line with house price inflation, it would be levied only on properties worth £1.3 million or more today. In 2000, 391,000 homes were exempt from stamp duty. Today, that number has almost halved. That is the level, scope and scale of the fiscal drag we are discussing. The average UK house price in 2000 was around £110,000, which is well below the 3% threshold, but the average price today, according to the Office for National Statistics, is £265,000, which is well over the 3% rate, landing middle-income home buyers with a bill of some £8,000. If we are really in the business of supporting and encouraging savers, how on earth can we justify such a penalty? Sales in the 3% band covering homes worth between £250,000 and £500,000 increased from 8% as a proportion of total sales in 2003 to 19% in 2013. According to London Central Portfolio and the Cass business school, revenue from the 3% band has almost tripled since 2000, rising from £724 million to close to £2 billion this year.

Such a fiscal drag is not only a serious problem in its own right, but should also serve as the starkest of warnings to anyone in any party who is tempted by a mansion tax, as proposed by Labour and the Liberal Democrats. That is perhaps why no Labour Back Benchers are here to justify either the stealth tax implemented by the former Prime Minister, the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown), or their current proposals.

[Mrs Main]

I am pleased that my hon. Friend mentions the mansion tax, because there has been much rhetoric about it catching only the wealthiest. I completely agree with him that people felt that the 3% stamp duty threshold was not for them and only for the wealthiest, but in areas such as mine and his, it will soon become a mansion tax for the ordinary and not the wealthy.

[Mr Raab]

My hon. Friend is absolutely right. When the Liberal Democrats originally started discussing a mansion tax, it was to be levied on homes worth £1 million, and when everyone complained about fiscal drag, stamp duty and the like, it was increased to £2 million. What is most interesting is that if the Liberal Democrats use that extra money for the perfectly laudable objective of increasing the personal tax allowance still further, there is a black hole of something like £6 billion in their spending plans, so they would have to increase the net of their mansion tax. The lesson from stamp duty that the Labour party has offered us, which the Liberal Democrats ignore and which Conservatives must take on board, is that what starts out as a tax on the rich always ends up—I will use the word my hon. Friend used—clobbering the middle classes. That is the stark reality that we must guard against.

Stamp duty should be abolished for homes under £500,000 and the remaining thresholds should be indexed to house price inflation in primary legislation. It would be a dynamic tax cut that would probably—it can never be guaranteed—raise additional revenue. I set out in a report for the Centre for Policy Studies how we could fund the change up front by cutting back on the waste mentioned by my hon. Friend. Extra revenue could be raised while a major economic and social issue is dealt with.

Stamp duty has morphed into a vindictive stealth tax on aspirational Britain. It distorts the housing market. It warps labour mobility. It penalises savers. It wallops those on relatively low and middle incomes. The case for reform is overwhelming.