Finance (No. 3) Bill

Bob Stewart Excerpts

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

[Carolyn Harris (Swansea East) (Lab)]

May I say what a pleasure it is to speak today, Dame Eleanor? I am delighted to say that the Members who tabled and put their names to the amendments and new clause will not press them to a vote because—in case anybody has not heard—the Government finally saw sense and backed down on the implementation date for the reduction of stakes on fixed odds betting terminals. [Hon. Members: “Hear, hear!”] Thank you.

I stand instead to make a point: the power of the Back Benchers cannot be ignored. This House is fortunate to have so many Members, on all Benches, who are prepared to put principle before both profits and politics. I pay tribute to the many colleagues in this place and the other, and I pay special tribute to the hon. Members for Inverclyde (Ronnie Cowan) and for Strangford (Jim Shannon), to the right hon. Member for Chingford and Woodford Green (Mr Duncan Smith), to the hon. Member for Worthing West (Sir Peter Bottomley) and to the wonderful hon. Member for Chatham and Aylesford (Tracey Crouch), whose principles led to her resignation. I thank them all for their support, dedication and downright determination to force the Government’s hand.

The result has been a long time coming, but this issue has demonstrated the very best of this House, where politicians of all persuasions came together, united in seeking to make sure that the Government were held to account for their reluctance to put people’s lives ahead of company profits. The Government had so many opportunities to do the right thing, but they seemed determined to pander to the whim of an industry set to make nearly £1 billion of profit in the six-month period between April and October 2019. It is regrettable that it took strong-arm tactics by Members to convince them to make the change and that they did not come to a principled decision on the morality of the problem—the devastation that these machines have caused to individuals, communities and families.

[Bob Stewart (Beckenham) (Con)]

I thank the hon. Lady and everyone who has played a part in this campaign. Is it not tragic that it has taken this House 17 years to sort out the matter? We are congratulating ourselves on having achieved something, but, in those 17 years, we are fully aware of the lives that have been wrecked by our inactivity. Thank goodness that we have got it right now.

[Carolyn Harris]

I certainly agree with the hon. Gentleman.

May I just say that I cannot thank the Government? As much as I respect and like the Minister, I can say only one thing: learn lessons from this and never underestimate the power of principle.

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[Mel Stride]

My hon. Friend is entirely right. One thinks, for example, of the sugar levy to improve public health and to make sure that our young people, in particular, move towards a healthier diet. Tax can certainly have an effect in that respect. As my hon. Friend said, there is also the duty on cigarettes, tobacco, hand-rolling tobacco, and alcohol to make sure that as well as just raising revenues, we change behaviour in a way that is conducive to the public good.

[Bob Stewart]

My right hon. Friend has not mentioned fairness in taxation. That is another principle that we must use for taxation. Fairness implies that the people who have the least pay the least and that those who can afford it pay more. I am quite sure that the Government are fully aware of that point when raising taxation.

[Mel Stride]

I thank my hon. Friend for that important intervention. He is absolutely right: fairness has to be the heart and soul of any progressive taxation system, along with competitiveness—we want to keep rates down—and the importance of tax being paid, as I have been elaborating on. On his specific point, we were of course able to announce in the recent Budget—this forms part of the Bill—the increase in the personal allowance, which is now up to £12,500. Bear in mind that in 2010 the personal allowance was about £6,500. The personal allowance is, of course, the amount that an individual can receive by way of earnings without those earnings falling due to income tax. Any increase in the personal allowance does indeed have a disproportionately beneficial impact on the lowest-paid in our country. Since 2010, in fact, we have now removed some 4 million people in total from tax altogether.

--- Later in debate ---

[Mel Stride]

It is one of the key drivers in tackling tax avoidance and the tax gap—the tax gap occurs not just with individuals but with large corporations and small businesses. I do not have the precise number, but I am happy to write to the hon. Gentleman with that information. What I can tell him is that, at any one time, about 50% of the largest 200 businesses in the country are under investigation, not necessarily because they have done anything wrong but because, logically, HMRC should be looking particularly carefully at the businesses that are making the largest profits and generating the most.

This investment is paying off. In 2017-18 alone, HMRC secured and protected more than £30 billion in additional tax revenues which otherwise would have gone unpaid. That was a year-on-year increase of £1.4 billion.

We know that some large multinationals have been able to avoid tax by exploiting gaps and mismatches in the international tax system. International leadership was required to address the situation, and that is exactly what the Government have provided. We were at the forefront of the OECD’s base erosion and profit shifting project, which agreed major reforms to the international tax system, and we have taken the lead in implementing these recommendations in domestic legislation. We have also been a strong supporter of the EU anti-tax avoidance directive, and we have helped to shape the common approach that it provides for tackling avoidance in the European Union.

[Bob Stewart]

I thank my right hon. Friend for giving way to me again. For the sake of fairness, we must of course ensure that multinational companies making profits in our country contribute properly to the economy of the country. I hope very much that we can somehow link the profits made in the United Kingdom very closely to the amount of tax that is paid. At the moment some international companies are behaving appallingly in the way in which they handle their tax affairs, and we must sort that out.