Budget Resolutions

Debate between Dan Tomlinson and Ashley Fox

Monday 2nd November 2026 Commons Chamber

[The Exchequer Secretary to the Treasury (Dan Tomlinson)]

It is a pleasure to close this Budget debate on good growth in every postcode. I thank Members from across the House for their contributions in today’s debate. In particular, I want to thank my hon. Friend the Member for Holborn and St Pancras (Sagal Abdi-Wali) for her fantastic maiden speech. She spoke powerfully of the “everyday way”, in her words, that people in her part of London look out for each other. I know that she will look out for her constituents every single day. I, along with Members from across the House, I am sure, warmly welcome her to the Labour Benches.

The Budget last week was a Budget to provide breathing space now and fresh hope for the future. It backed British business to unleash growth in every postcode and it kick-started the changes needed to put our country on a better course. It was also a Budget set against the backdrop of global economic storms, with trade tensions acting as a drag on global growth and Putin’s illegal invasion of Ukraine approaching the end of its fifth year. These shocks may be global, but the effects are being felt here at home.

According to the Office for Budget Responsibility, we will spend £14 billion more each year on debt interest compared with the previous forecast. The Government’s responsibility is, of course, to determine how to respond to that. We have chosen to respond by using some of the headroom, which was built up last year, to absorb the impacts of the war and to protect the economy and family budgets as much as possible. We have also chosen, crucially, to meet the fiscal rules in full, with borrowing falling in every year of the forecast.

Britain’s economic reputation was badly damaged under the Conservatives—so badly damaged, in fact, that the IMF publicly warned them to change course. The contrast now could not be clearer. The IMF said recently that the UK “stands out” as a country where we are taking

“action to reduce the debt and deficit”

and that action “has been taken decisively”. Despite the warnings from forecasters and the gloomsters on the Opposition Benches that our economy would slow down, Britain has defied expectations this year. The OBR has upgraded the UK’s growth forecast and in the first half of this year we had the joint-fastest growth in the G7. Productivity growth is up at 2.2% a year, compared with an average growth rate of 0.5% a year between 2015 and 2024.

[Sir Ashley Fox]

If everything is going so well, why is Britain paying more to borrow money than any other country in Europe?

[Dan Tomlinson]

The hon. Member is right to raise the fact that we are spending a large share of our budget on debt interest costs; £1 in every £10 is spent paying the interest on our debt. That was an increase that took place under the Conservatives after the spike in interest rates in 2022 under Liz Truss’s mini-budget, and the apprentice to Liz Truss is now the shadow Chancellor.

Real wages have risen more since the election than in the first 10 years of the Conservative Government. Opposition Members talked about the private sector in the economy. I would point out to them that whole-economy investment and business investment have grown by more in this Parliament so far than they did in the entirety of the last Parliament. We are turning the economy around from the hellscape it was under the previous Government.

We are building on our recent economic resilience through this Budget. We are delivering immediate measures to help with rising energy bills: a £100 household energy payment directly to those living in property bands A to D in England, alongside a reduction to 0% VAT on electricity until July. We are also abolishing gas standing charges on household energy bills, while extending the 5p fuel duty cut and the cut to red diesel. We are reducing bills by up to 25% for more than 10,000 eligible businesses from next April through the British industrial competitiveness scheme.

Finance (No. 2) Bill

Debate between Dan Tomlinson and Ashley Fox

Report stage & 3rd reading
Wednesday 11th March 2026 Commons Chamber

[Dan Tomlinson]

I am glad to return to the Commons to debate the Finance Bill on Report. Although I am sure that it would have been of interest to Members on both sides of the House, I am also glad that we have not just had a set of two 45-minute debates on the Ways and Means motions. The opportunity was there, but I am glad that Members did not take it in full. We now have ample time for this important Report stage.

I thank Members on both sides of the House for their contributions in Committee. I thank in particular the shadow Exchequer Secretary to the Treasury, the hon. Member for North West Norfolk (James Wild), for his scrutiny and challenge, and for the invitation to his wonderful constituency, which I hope to take up one day. As yet, no other Opposition Front Bencher has offered me such an enticing prospect as a visit to their constituency, but I look forward to those invitations.

Before I turn to individual amendments, I wish to reflect briefly on the Budget that was delivered in November by my right hon. Friend the Chancellor of the Exchequer. That Budget took fair and necessary decisions to deliver on the Government’s promise of change, to support cuts in the cost of living, to enable NHS waiting lists to continue falling, and to ensure that our national debt fell as a share of GDP and that borrowing falls over the course of this Parliament. As the Chancellor said in this place yesterday and on Monday, Government borrowing—public sector net borrowing—has fallen from 5.2% to 4.3% of GDP, which is a fall of 1 percentage point. That is very significant and means that our borrowing is coming down, as part of our plan to bring stability back to the public finances.

[Sir Ashley Fox (Bridgwater) (Con)]

Does the Minister acknowledge that debt reduction is taking place only because the Government have increased taxes by £66 billion? That contrasts with the tax rise of £7 billion that the Labour party promised in its manifesto. Could he explain the huge discrepancy between that manifesto promise and what the Government are imposing on our constituents?

[Dan Tomlinson]

I ask the hon. Member to consider whether his party wishes to identify £66 billion of expenditure cuts or borrow £66 billion more. I do not think that either option is what the British public want; they want us to bring borrowing down and get public finances under control, after they were spun out of control by Liz Truss and the previous Government. The public understand the need for fair and responsible increases in taxation to ensure that we can invest in our public services and in the future of our country.

[Dan Tomlinson]

I strongly agree with my hon. Friend. I thank him for making his representations again and for his ability to mention Harlow in his interventions. It is a fantastic part of the country, not too far from my constituency in north London, and I know just how strongly he seeks to represent it and to make sure that the public services in his patch—the local hospitals and schools—get the investment they need. That is why he and I are able to proudly support this Government’s decisions to bring the public finances back into good order, as well as to invest in our public services and to get borrowing down.

Of course, though, since the Budget, and particularly in recent days, the world has changed. As the Chancellor set out last week in responding to the Office for Budget Responsibility’s spring forecast, it is more important than ever that the Government continue to deliver on our economic plan. The choices that we have made at previous Budgets will fix long-standing issues in the taxation system, restore economic and fiscal stability, and lay the economic foundations that we need for higher growth and higher living standards across our fantastic country.

The Bill legislates to deliver on those choices, all while sticking to our commitment not to raise the main rates of income tax, employee national insurance contributions or VAT. We are also providing stability for businesses by keeping to important commitments in our corporate tax road map to keep our corporation tax rate at 25%—the lowest in the G7—rather than having it chop and change up and down, like it did during previous Administrations.

I thank all those who have submitted written evidence throughout the Bill’s passage. Following concerns raised by professional bodies and concerns discussed in the Public Bill Committee, I would like to take this opportunity to reiterate my reassurances to the sector that measures that directly impact tax advisers are intended to create a fairer tax advice market. I have heard concerns that tax advisers might be penalised if they file a client’s tax return late when their client has not provided their approval for filing the return on time. I want to clarify that these powers are not designed to penalise responsible tax advisers who act in good faith, and in that specific scenario, a tax adviser would not be penalised under His Majesty’s Revenue and Customs’ stronger powers. The Government are committed to ensuring that the tax system works effectively for everyone, which is why we are introducing a number of amendments on Report to ensure that the tax system is working effectively and as intended.

I turn to the first group of Government amendments. New clause 5 removes specific provisions that could prevent offshore income gains from being designated under the temporary repatriation facility, or TRF, to ensure that they can be designated as intended. The amendments also simplify the existing treatment of offshore non-reporting funds held by offshore structures for all taxpayers. New clause 6 introduces transitional provisions for offshore income gains arising before 6 April 2025.

Following the abolition of the lifetime allowance, new clause 7, as we were just discussing, ensures that multiple different regimes do not apply, providing clarity for pension schemes and members. It ensures that any necessary regulations can have a retrospective effect back to 6 April 2024, clarifies the scope of the original power, extends the power by a further three months and ensures that regulations are subject to the affirmative parliamentary procedure.

The Government are making a number of minor and technical amendments to help provide greater clarity and address important points that have been raised by stakeholders, particularly during the passage of the Bill. These amendments simply put the original legislative intent beyond doubt.

Amendments 12 and 13 ensure that clause 23 will apply only to general earnings for the tax year 2026-27 and subsequent tax years that are paid on or after 6 April 2026. Amendment 14 tightens the existing provisions under clause 24 to ensure that those rules do not catch legitimate agency structures.

Amendments 48 and 51 remove legislation that is not necessary under clause 43 and ensure that the TRF legislation works as intended, so that beneficiaries from overseas trusts are able to make designations in connection with offshore income gains.

Amendments 49, 50 and 52 are consequential amendments to schedule 3 and clause 43. They remove references to omitted legislation and insert wording to clarify reference to the Taxation of Chargeable Gains Act 1992.

Amendment 53 to clause 49 makes clear that a person concluding contracts on behalf of a non-resident company must be present in the UK when concluding those contracts in order to create a permanent establishment in the UK.

Amendments 56 to 61 to schedule 11 concern the rules preventing fund managers from circumventing the revised carried interest tax regime. These amendments ensure that the provision operates as intended, where two connected persons work in the same business, with each connected person only taxed on their own carried interest.

[Sir Ashley Fox]

It sounds as if the Minister is adding many, many extra pages to our tax code. What provisions will he be bringing forward to shorten and simplify the tax code?

[Dan Tomlinson]

The hon. Gentleman raises an important point. We need to do all that we can to ensure that we are simplifying our tax code in order to make it easier for tax advisers, individuals and businesses. I have also asked that question, but I am reassured by my officials—I am sure that the hon. Member could consult Hansard too—that this is a typical number of amendments to be made to a Finance Bill. This is a long Finance Bill, but there are a whole range of important changes that the Government wish to introduce and to make progress on. I am sure Members from all parties have enjoyed poring over the changes to the tax legislation. I do take his point about simplification, though; it is something that I wish to focus on. If hon. Members have good ideas in that space, they would genuinely be welcome to write to me.

--- Later in debate ---

[Dan Tomlinson]

I thank all Members for their contributions at this stage of the Bill’s passage—we are almost there. I will take some time to respond directly to the amendments that have been discussed today.

I will first address amendments 1 to 4, 5 and 7, which were spoken to by the shadow Exchequer Secretary, the hon. Member for North West Norfolk (James Wild). Amendments 1 to 4 would remove the increase in dividend, savings and property income tax rates; amendment 5 would prevent income tax thresholds from staying at their current levels until 2030; and amendment 7 would remove reforms to the inheritance tax treatment of pensions. Based on costings that have been certified by the OBR, the direct impact of these amendments would cumulatively reduce forecast revenue raised in 2029-30—the year of relevance for our fiscal rules—by a whopping £12 billion. These amendments therefore pose a significant risk to the sustainability of our public finances and to our ability to fund the NHS and the public services that we all rely on. I therefore urge the House to reject them.

[Sir Ashley Fox]

Would the Minister concede that if that was offset by £12 billion less welfare spending, there would not be any threat to the sustainability of the finances?

[Dan Tomlinson]

If the Conservatives had credible plans and a credible history of reining in welfare spending, then I would, of course, be interested in taking them seriously. However, it was the shadow Chancellor, the right hon. Member for Central Devon (Sir Mel Stride), who was the Work and Pensions Secretary when the welfare budget exploded. We are now trying to get on top of that.

I will not address new clauses 15 to 19 directly. The Government have set out our position on them at previous stages, although I do urge the House to reject them today.

I will now turn to the points raised by the hon. and learned Member for North Antrim (Jim Allister) around amendments 112 to 139, which would have the effect of removing the distinction between the options available in respect of “specified Northern Ireland companies” and other companies from clauses 13, 14 and 15. The hon. and learned Gentleman has made his views known very clearly both today and on Second Reading. I will make the same point that the Economic Secretary to the Treasury made on Second Reading: as he will be aware—although he did not, I believe, mention this in his speech —service companies are able to benefit from the increase in the threshold. It is the Government’s understanding that there are very few, if any, goods and electricity companies in Northern Ireland that are close to the current enterprise management incentive limits, and we therefore think there will be minimal impact from these companies being subject to the previous scheme limits.

Oral Answers to Questions

Debate between Dan Tomlinson and Ashley Fox

Tuesday 10th March 2026 Commons Chamber

[The Exchequer Secretary to the Treasury (Dan Tomlinson)]

On business rates, the Government have announced a support package for all businesses worth £4.3 billion over the next three years. We have introduced permanently lower multipliers for eligible retail, hospitality and leisure businesses, including those on the high street. In addition, every pub and live music venue will get 15% off its new bill from April. The Government will also bring forward a high streets strategy later this year.

[Sir Ashley Fox]

Many retail, hospitality and tourism businesses in my constituency traditionally give young people their first job, but with the Chancellor’s jobs tax, the unemployment rights Act and now huge increases in rates, many of those businesses are struggling to survive, so they just cannot afford to take on those young people. Does the Minister accept that his Government are the reason that youth unemployment is now higher in the UK than in the EU for the first time since records began?

[Dan Tomlinson]

One reason we have a challenge with youth participation in the labour market is the broken welfare system and the broken support system that we inherited from the previous Government. The proportion of young adults who are not in education, employment or training is broadly unchanged since the general election. It is too high, and it has to come down. That is why we are reforming our system and providing more support through actions such as our jobs guarantee. That is the right approach, as is the approach we are taking on business rates.

Oral Answers to Questions

Debate between Dan Tomlinson and Ashley Fox

Tuesday 9th December 2025 Commons Chamber

[Sir Ashley Fox (Bridgwater) (Con)]

18. What assessment she has made of the potential impact of extending freezes on income tax and national insurance thresholds on working people.

[The Exchequer Secretary to the Treasury (Dan Tomlinson)]

The Chancellor was clear at the Budget that we are taking the fair and necessary decisions on tax to do all we can to ensure that the contribution of working people is kept as low as possible. We have reduced the gap between taxes on income from assets and on income from work, stopped the unfairness that meant people could pay less council tax for a £10 million property than for a typical terraced house in much of England, and done much more.

[Dan Tomlinson]

I am a bit confused by that question. The hon. Member said there was one word that was important. Let me give him one figure: £150. That is the amount we are taking off energy bills next year to help people to deal with the cost of living in the here and now. We are supporting people because of the mistakes that previous Governments made by not investing in our energy infrastructure and not investing in our future. We are picking up the pieces after the Conservatives did not take the necessary decisions.

[Sir Ashley Fox]

Extending the freeze on income tax thresholds will cost working families £900 a year. It will also drag many pensioners into paying income tax for the first time. Why is the Minister hitting these low-income families to pay more for welfare?

[Dan Tomlinson]

I suggest the hon. Member asks his Front Benchers why 75% of the impact of people paying more tax at the lower end is the result of decisions made by the previous Government, who spent seven years freezing income tax thresholds. It is a bit rich for the Conservatives to talk about this Government doing it for three years when they did it for seven years.