Finance (No. 2) Bill

Charlie Maynard Excerpts

Wednesday 11th March 2026 Commons Chamber

[Madam Deputy Speaker (Judith Cummins)]

I call the Liberal Democrat spokesperson.

[Charlie Maynard (Witney) (LD)]

The Bill, and the Budget it derives from, demonstrates clearly that the Chancellor has implemented stealth tax grabs that will hit some of the lowest paid the hardest, through extending a freeze on income tax thresholds and the national insurance contributions increases which suppress employment and wages. It is full of short-sighted harmful decisions that the Liberal Democrats cannot support. Our amendments aim to highlight and reduce some of its more harmful impacts.

I will focus on four particular areas, the first of which is the impact of frozen income tax thresholds. New clauses 15 to 17 would secure additional information and analysis about their impact. As the worrying figures from the OBR suggest, continuing to freeze income tax thresholds will drag an extra 1 million pensioners into paying income tax for the first time by 2030-31, unless the Government act.

[Mr Joshua Reynolds]

My hon. Friend is right about pensioners being dragged into paying income tax. Does he agree that millions of those pensioners will want to be able to contact HMRC and ask it about those changes? Millions of people never manage to get through to HMRC and figures from a written question I put in recently show that HMRC has lost 2,000 customer service staff in the past few years. Does he agree that we need a red phone hotline to allow pensioners to get hold of HMRC for support and advice when they need it?

[Charlie Maynard]

I completely agree. The stress of that is horrific, so the more it can function effectively would be appreciated.

The Government have said that people whose only source of income is the state pension will not pay any income tax over this Parliament, but no details have been provided on how they will be protected. I ask the Government to put an end to the uncertainty and set out plans in full explaining exactly how they intend to shield pensioners from that unfair tax hit. We would love a timeline for when they will do that.

More broadly, extending the stealth tax by two more years will drag an estimated 1.3 million people into a higher tax band by 2029-30: just over 600,000 into the basic rate of tax and just under 700,000 into the higher rate. Those are big numbers. We would really appreciate it if the Government explained to each of the 1.3 million people who will be impacted what it will do to them, because I do not think they are aware of it right now. That disproportionately impacts those on low incomes who will be dragged into income tax for the first time. At the very least, please provide that information.

Next is the impact of the Government’s actions and inactions on youth unemployment, which is building to a real crisis point. Some 16% of all 16 to 24-year-olds are out of work, or almost 740,000 people, which is 100,000 up in the last year—I repeat, 100,000 up in the last year—so something is going wrong with the Government’s policies and we need to get to the bottom of that. The Liberal Democrats have tabled new clause 14, which requires the Chancellor to review and report on the impact of the Bill on unemployment, with particular regard to young people aged 16 to 24.

It is worth noting that this legislation, which dampens growth and hits jobs, comes at a time of broader disruption in the labour market. AI is already having a particular impact on entry level so-called white-collar jobs, but it is also having an impact in pubs. All our local pubs are hiring fewer young people because there is no incentive to do so any more. The creation of a new employers’ national insurance contribution band between £5,000 and £9,100, with a lower rate to incentivise employers to hire often younger, part-time workers, would really help.

In new clause 13, we highlight the complexity of the tax system and the cost of administering it. There is a green brick sitting here masquerading as a Bill. With such a big majority in this Parliament, the Government have a real opportunity to do some serious thinking about how to simplify, root and branch, our tax code. It is disappointing that we see no sign of that actually happening. With this size of legislation being added each time, the tax system is getting bigger and more complex, and that puts a real burden on business. The Treasury Committee, the Public Accounts Committee and the Business and Trade Committee have all spoken out about how much damage our over-complex tax system is doing to our businesses. We would really appreciate anything that the Government can do and if they could get more serious about that.

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[Rachel Gilmour (Tiverton and Minehead) (LD)]

We welcome the Government’s changes on APR—a new £2.5 million threshold was announced just before Christmas—but does my hon. Friend share my concern that genuinely active, long-held family farms and long-standing tenant farming arrangements will still be penalised by the Government? Does he therefore agree that Members should back the Liberal Democrat amendment, which would maintain relief at 100% where the property has been owned by the transferor for at least 10 years as part of a business that is actively operated by the transferor or a family member?

[Charlie Maynard]

I thank my hon. Friend for speaking up on this matter. I know that my hon. Friend the Member for Westmorland and Lonsdale (Tim Farron) feels very strongly about it as well.

We do not really understand why the Government have decided to go with those fixed static thresholds. Everybody recognises that agricultural land values go up and that the cost of living goes up. We would really appreciate it if the Government could explain why they have decided not to index that. We will therefore be pushing new clause 11 to a vote, because we really want to see that fixed.

[Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)]

I will speak to the two new clauses that stand solely in my name, which relate to the impact of the changes to the remote gaming and remote betting duties. I do not intend to relitigate the rights and wrongs of those changes; we have had a number of debates on that subject in this Chamber and in Westminster Hall, and the determination has been settled by Treasury. However, I do think it is important that we consider what I believe are the genuinely unintended consequences of the changes that the Treasury will introduce and how best to mitigate them. To mitigate them, though, we need to understand them, so new clause 8 simply seeks to get an independent assessment of the changes to the remote betting and remote gaming duties on the black market.

I am sure that those of us who have participated in debates around gaming and gambling will accept that there are challenges that we need to address with problem gambling, but that requires people to participate in the regulated sector, where help and support is available for those who find themselves getting into trouble. The more people we push into the black market—where there is no support, no GamCare, no lock-out system—the more people are at risk of harmful activity and being preyed upon by predatory organisations and companies that are outside the UK, do not pay taxes here and are simply not worried about the participants.

The independent study done by EY for the Betting and Gaming Council found that there is a potential for £6 billion-worth of stakes to be diverted into the black market as a result of this change. That is £6 billion of stakes that were going to be made somewhere, but will now go into the black market and will therefore not be subject to any taxation, including any form of potential corporation tax if they are staked outside the UK with one of the companies headquartered elsewhere, or to the remote gaming duty. That is a 140% increase on the potential stakes going into the black market.

It also means thousands and thousands of people—our constituents—who will find themselves in an unregulated part of the gambling and gaming economy, where there is absolutely no help and support for them. The people who run those sites have no interest in the welfare of those individuals whatsoever; they simply want to try to maximise their profits. Every single one of us is no more than two clicks away from an unregulated gaming or gambling site, and we should be open and acknowledge the fact that that money often funds questionable activities overseas, including organised crime and, in some cases, terrorism.

I recognise that the Treasury has, as part of broader changes to the betting and gaming regulations, identified £26 million for the Gambling Commission to try to mitigate some of the worst aspects of those activities, but we simply do not know what impact that will have; the assessment has simply not been done by the Government to determine whether that £26 million is enough. Frankly, every penny that could be spent on helping people in this country to avoid damaging gaming and gambling, and to enjoy regulated gaming and gambling, should be spent.

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[Jim Allister]

There is absolutely no doubt about that, and the Government are putting it up in lights. They are saying to new businesses coming into the United Kingdom or starting in the United Kingdom, “If you place yourself in GB, you will have an uplift available to you in terms of the aid we can give and the venture capital you can draw in, but if you stay in Northern Ireland then you will be at the bottom of the pile, treated unequally.”

[Charlie Maynard]

Will the hon. and learned Gentleman please remind the House what last year’s growth rate was for Northern Ireland compared with for the whole UK? I think it might have been three times higher.

[Jim Allister]

That is a very insightful question, but the answer is even more insightful. The growth we have had in Northern Ireland is in the services sector—lo and behold, the sector that is outside the Windsor framework. The manufacturing sector, which is clobbered by the Windsor framework, has not grown. The growth we have had—and thank goodness for it—is in the services sector. Contrary to the hon. Gentleman’s mantra of believing that all things EU are precious and beneficial, that is an illustration and an indication that our liberation from the EU in terms of services has served us well, but our entrapment in the EU in respect of manufacturing has served us very ill. The Bill underwrites that disadvantage to Northern Ireland.

I say to the Minister: tell my constituents and my businesses why they are treated differently, why they are less deserving of the same capacity to be supported, why they cannot draw in the same level of venture capital or investment schemes, and why they are the second-class citizens of this United Kingdom. The answer, as I have said, is because this Government are wholly beholden to the EU. This is a Government with a reset policy. If they follow the trends of Northern Ireland, then very shortly under their reset policy, they are going to enslave themselves again to EU state aid rules; they are going to end up in the same predicament, where they will not be allowed to increase their state aid, such as they are doing here.

There is one final point that the House needs to understand. If there is a dispute over whether there has been state aid that might breach the rules of our foreign masters, it is not the courts of this land that would decide on such a matter, but the European Court of Justice. It is so obnoxious, so wrong and so offensive that, though I sit as a Member for a United Kingdom constituency and come to this Parliament of the United Kingdom, this Parliament cannot make laws governing these issues in Northern Ireland because of the surrender of sovereignty to the EU. If this Government had any backbone and cared about parity in the United Kingdom and about the businesses in my constituency, they would be setting about giving us an equal playing field and facing down those who insist that it is their laws, not ours, that must apply.

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[Charlie Maynard]

I speak on behalf of the Liberal Democrats, and the shadow Minister’s audacity in talking about a “high-tax, low-growth doom loop” is pretty high.

With regard to this Bill, I ask the Government to look again at four things. I will go through them quickly, and then I will sit down. I ask the Government to provide more detail, and quickly, on their plans to prevent pensioners from being dragged into paying income tax; to publish information on how the freezing of tax thresholds until 2030-31 impacts households at various income levels; to recognise the impact that the Government’s policies are having on youth unemployment, which is up by 100,000 in the last year, and to take steps to halt this rapid rise, which at a minimum would include reducing the national insurance contributions rate paid by employers on part-time employees earning between £5,000 and £9,100 per year; and, finally, as per new clause 11, which we just pushed to a vote, to look again at taking a fairer approach to farmers by allowing the thresholds on agricultural property relief to rise over time in line with agricultural land prices, rather than having those thresholds eroded over time.

Question put, That the Bill be now read the Third time.

The House proceeded to a Division.

[Madam Deputy Speaker (Caroline Nokes)]

Will the Serjeant at Arms investigate the delay in the Aye Lobby?