Income Tax (Charge)

Gagan Mohindra Excerpts

Thursday 4th March 2021 Commons Chamber

[Mr Gagan Mohindra (South West Hertfordshire) (Con) [V]]

The Treasury team’s ability to be dynamic in a quickly changing environment has saved many people up and down the country, including in my constituency, from financial ruin and job loss. The previously predicted job losses have not materialised, and credit must partly lie with the Government’s unprecedented support. The covid debt burden of £407 billion, with the largest borrowing levels outside wartime, is significant. I would argue that we are fighting and winning a world war against an invisible enemy: the covid-19 pandemic. There may be an argument similarly to use a war bond as a way of financing this significant debt, and I will leave that thought with my Treasury colleagues.

This pandemic has not been fair, and this Government have continued to be pragmatic and target support broadly in the right areas. Support like universal credit has succeeded, and I commend the Secretary of State for Work and Pensions for its successful implementation, especially with the significant increase in demand during the pandemic. It is a sign of its success that no one has really mentioned it. The scary predictions of job losses at the start of the pandemic have not materialised, but I know my right hon. Friend will continue to focus on getting the 700,000 people who have lost their job through no fault of their own back into work. We must continue to provide the tools to allow our people to get back on their own two feet.

When I spoke to my constituents, they were clear that they wanted two things from yesterday’s Budget, namely certainty and financial prudence. This Budget has done both, with certainty about VAT cuts and the furlough extension, so that businesses are best placed to ride the wave of our recovery. The restart grants and business rates holidays are also well worth mentioning. This does not mean a magic forest of money trees, and the honesty shown by the Chancellor gives all people the respect they deserve by not hiding difficult financial decisions. Outside of business support, I welcome the extension to the stamp duty holiday and the new mortgage guarantee for homebuyers. As a recent first-time buyer myself, I know how life-changing home ownership can be. It is right that we give more people the opportunity to buy if they choose. The proactive policies mean that generation rent will quickly become generation homeowner.

May I take this opportunity to add to the Treasury’s homework? Things I would like the Treasury to look at in future include the wholesale reform of business rates, as this will be critical to ensuring our businesses do not all leave our city centres and high streets and revert to an online-only or virtual presence. That, in my humble view, is not a legacy we would be proud of. Covid-19 has accelerated the change in our working and buying habits. I urge the Chancellor to grasp this opportunity for tax reform to ensure that all businesses have a level playing field.

There are some who have benefited from the new rules and guidance offered during these difficult times, but some have chosen to take advantage instead of doing the right thing. Specifically, I would query why blue-chip and cash-rich companies are delaying payment of commercial rent. It is worth noting that savers up and down the country have a vested interest, as many pension funds are the ultimate landlord. This is not a victimless act and may be a ticking time bomb we should be looking to defuse before it is too late.

I applaud the Chancellor’s approach to supporting wealth creators, as this will accelerate our recovery and ensure sustainability. I thank the Government for being so proactive and reactive to the pandemic.