Asked by: Clive Lewis (Labour - Norwich South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what plans he has put in place to maintain job security for workers on North Sea oil rigs when Transferable Tax History is implemented.
Answered by Robert Jenrick
Transferable tax history will encourage new investment into the North Sea and prolong the productive life of the basin. This will help protect the 280,000 jobs across the UK that are supported by the industry.
Asked by: Clive Lewis (Labour - Norwich South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make an assessment of the effect of trends in the level of oil prices on the cost to the public purse of the Transferable Tax History.
Answered by Robert Jenrick
Transferable tax history (TTH) is expected to increase tax receipts from the oil and gas sector by £65 million between tax years 2018-19 and 2023-24. This is based on forecast oil and gas prices as set by the independent Office for Budget Responsibility.
A higher oil price will encourage investment in oil and gas extraction, facilitating more transactions for oil and gas fields and increasing the use of the TTH mechanism. Therefore, TTH would help increase revenues from oil and gas through increased production.
A lower oil price will reduce the incentive for investment and decrease the likelihood that mature oil and gas fields will be sold. In this scenario the yield from new investment as a result of TTH will be lower. However, a low oil price is unlikely to result in TTH having a negative impact on tax receipts.
Asked by: Clive Lewis (Labour - Norwich South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment the Government has made of the effect of Transferable Tax History on the incentives for buying companies to increase oil and gas production and generate further revenues.
Answered by Robert Jenrick
The Government, with technical advice from the Oil and Gas Authority (OGA) and representations from the industry via the trade body Oil and Gas UK, assesses that there will be instances when companies hoping to purchase mature fields will be in a position to extract more value from the field through investment than their current owner.
However, there is a barrier to these deals taking place due to the uncertainty around whether the buyer will obtain equivalent decommissioning tax relief.
Transferable Tax History (TTH) overcomes this uncertainty, enabling companies to complete asset deals on mature fields and allowing new investment to take place. Without TTH, transactions for mature assets are expected to be less common and the increased revenue from production is not realised.
More details can be found in the published policy paper, “Oil and gas taxation: transferable tax history and retention of decommissioning expenditure”.
Asked by: Clive Lewis (Labour - Norwich South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what distributional analysis his Department has carried out on the exemption for mineralogical and metallurgical processes from the Climate Change Levy.
Answered by Robert Jenrick
Exemptions from Climate Charge Levy were designed in consultation with energy suppliers and businesses in a way that seeks to minimise business burdens. They are applied by energy suppliers at the point of supply so HMRC does not therefore have the data to carry out any distributional analysis on the exemption for mineralogical and metallurgical processes.
Asked by: Clive Lewis (Labour - Norwich South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether he has carried out a distributional analysis in relation to Transferable Tax History; and if he will make a statement.
Answered by Robert Jenrick
Transferable tax history (TTH) will allow companies selling North Sea oil and gas fields to transfer some of their tax payment history to the buyers of those fields. The buyers will then be able to set the costs of decommissioning the fields at the end of their lives against the transferred history, to the extent that the costs exceeds the profits made on the transferred assets.
The Government held a public consultation on the discussion paper entitled “Tax issues for late-life oil and gas” from 20 March to 30 June 2017. 7 of the 9 questions in this discussion paper concerned TTH. Subsequently it was announced at Autumn Budget 2017 that TTH would be available for transactions that received Oil and Gas Authority approval on or after 1 November 2018.
The draft TTH legislation was published for public consultation as part of the draft Finance Bill 2018-19 on 6 July 2018. This further technical consultation closed on 31 August 2018.
The Exchequer and economic impacts of Transferable Tax History are set out in the published tax information and impact note on the gov.uk website:
Asked by: Clive Lewis (Labour - Norwich South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what consultation his Department undertook on the potential effects of Transferable Tax History.
Answered by Robert Jenrick
Transferable tax history (TTH) will allow companies selling North Sea oil and gas fields to transfer some of their tax payment history to the buyers of those fields. The buyers will then be able to set the costs of decommissioning the fields at the end of their lives against the transferred history, to the extent that the costs exceeds the profits made on the transferred assets.
The Government held a public consultation on the discussion paper entitled “Tax issues for late-life oil and gas” from 20 March to 30 June 2017. 7 of the 9 questions in this discussion paper concerned TTH. Subsequently it was announced at Autumn Budget 2017 that TTH would be available for transactions that received Oil and Gas Authority approval on or after 1 November 2018.
The draft TTH legislation was published for public consultation as part of the draft Finance Bill 2018-19 on 6 July 2018. This further technical consultation closed on 31 August 2018.
The Exchequer and economic impacts of Transferable Tax History are set out in the published tax information and impact note on the gov.uk website:
Asked by: Clive Lewis (Labour - Norwich South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what estimate his Department has made of the effect on the public purse of Transferable Tax History over the next 10 years.
Answered by Robert Jenrick
Transferable tax history (TTH) will allow companies selling North Sea oil and gas fields to transfer some of their tax payment history to the buyers of those fields. The buyers will then be able to set the costs of decommissioning the fields at the end of their lives against the transferred history, to the extent that the costs exceeds the profits made on the transferred assets.
The Government held a public consultation on the discussion paper entitled “Tax issues for late-life oil and gas” from 20 March to 30 June 2017. 7 of the 9 questions in this discussion paper concerned TTH. Subsequently it was announced at Autumn Budget 2017 that TTH would be available for transactions that received Oil and Gas Authority approval on or after 1 November 2018.
The draft TTH legislation was published for public consultation as part of the draft Finance Bill 2018-19 on 6 July 2018. This further technical consultation closed on 31 August 2018.
The Exchequer and economic impacts of Transferable Tax History are set out in the published tax information and impact note on the gov.uk website:
Asked by: Clive Lewis (Labour - Norwich South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will place in the Library a copy of the distributional analysis his Department has carried out on exempting zero emission capable taxis from the vehicle excise duty supplement for expensive cars.
Answered by Robert Jenrick
On publication of the draft Finance Bill 2018-19, the government published a tax impact and information note (TIIN) relating to the exemption of purpose-built zero emission capable taxis from the VED supplement.
The TIIN is available at: www.gov.uk/government/publications/exempt-zero-emission-capable-taxis-from-vehicle-excise-duty-expensive-car-supplement/exempting-zero-emission-capable-taxis-from-the-vehicle-excise-duty-expensive-car-supplement
Asked by: Clive Lewis (Labour - Norwich South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what estimate he has made of the number of (a) people and (b) businesses that will benefit from the workplace electric vehicle charging benefit-in-kind exemption.
Answered by Robert Jenrick
The Government’s estimate of the impacts from the workplace electric vehicle charging benefit-in-kind exemption was set out in the policy paper published on the 6th of July “Workplace charging for all-electric and plug-in hybrid vehicles”. (https://www.gov.uk/government/publications/workplace-charging-for-all-electric-and-plug-in-hybrid-vehicles/workplace-charging-for-all-electric-and-plug-in-hybrid-vehicles). This change is expected to affect a small number of those individuals who use an electric/plug-in hybrid vehicle which are not subject to the car or van benefit charge and impact on a small number of businesses.
Asked by: Clive Lewis (Labour - Norwich South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, with reference to the consultation, Cash and digital payments in the new economy, published in December 2017, whether his Department has made an assessment of the effect of the increase in cashless and electronic payments on homeless people.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The Government recognises that people are increasingly moving away from cash and that the growth in the use of digital payments has been rapid. However, the Government also recognises that widespread free access to cash remains extremely important to the day-to-day lives of many people, especially the more vulnerable members of society and the elderly. Government has been engaging and will continue to engage with the regulators and industry, including LINK, to ensure that it is maintained.
The Government established the Payment Systems Regulator (PSR) in 2015 with a statutory objective to ensure that the UK’s payment systems work in the interests of their users. As part of this, the PSR is monitoring developments within ATM provision.
The PSR have also set out three requirements of LINK: that LINK must maintain the current geographical spread of ATMs; that any changes made to interchange fees must be incremental to allow LINK to monitor the impact and take action if the impact is not as expected; and for a greater focus on LINK’s financial inclusion programme, to continue to fill gaps in the network.
Indeed, to ensure the provision of ATMs in rural, isolated or vulnerable areas, LINK announced it will enhance its financial inclusion plan to include in the programme all ATMs that are a kilometre or further from the next other free-to-use ATM.
While the Government has not made a formal assessment of the issue in question, the Government is open to hearing views, as evidenced by its recently closed call for evidence on cash and digital payments in the new economy. This sought information on how the shift from cash to digital payments impacts on different sectors, different regions and different demographics. The Government will formally respond to the call for evidence in due course.