Finance Bill

Debate between Ian Murray and John Redwood

Tuesday 1st July 2014 Commons Chamber

[Mr Redwood]

The figures I have been using refer to the whole coalition period and show a reduction in inequality, which I hope the hon. Gentleman will welcome. I do not recognise his figures on the child tax changes. The overall effect of taking a lot of people out of tax has been a very positive impact on their net incomes, as we would hope.

[Ian Murray]

If the right hon. Gentleman disputes whether an increase in the additional rate of tax would bring in more money, does he agree with the new clause’s call for a report? If it shows that the 50p tax rate brings in more money, will he and his Conservative colleagues advocate increasing it again?

[Mr Redwood]

I thought that I had dealt with that point. As far as I am concerned, it was proven conclusively in the ’80s that taking the rate down from 83% to 40% increased the revenue very substantially and on a sustainable basis. That was sufficient to persuade the official Labour party—perhaps not some Labour colleagues here today—not to increase the tax rate from 40% throughout its long years in government until the very end.

Growth and Infrastructure Bill

Debate between Ian Murray and John Redwood

Tuesday 23rd April 2013 Commons Chamber

[Ian Murray]

We are back to the same point from the hon. Gentleman. He still refuses to recognise the equation here. That may all be correct, but at the same time fundamental rights still have to be given up. Indeed, those safeguards in the 2006 Act have been wrapped around by many companies in terms of the dilution of share ownership.

[Mr Redwood]

I am interested in the hon. Gentleman’s attack on the idea of some tax privilege in the scheme. I imagine that he is a member of the House of Commons pension scheme, and there is tax relief on all contributions that he makes into the scheme, and full tax relief on gains and income in the fund. That seems perfectly reasonable. How does that differ from the tax advantages of this scheme?

[Ian Murray]

Being a member of the House of Commons pension scheme does not mean that I give up my rights at work. The equation is not there. I am not even sure whether the right hon. Gentleman has spoken in favour of these proposals. Does he support them? I am not sure that he does.

[Mr Redwood]

I am asking about tax avoidance. The hon. Gentleman has just condemned the scheme as tax avoidance. I am asking whether he is against all tax avoidance, or does he practise it as well?

[Ian Murray]

It is a little disingenuous to ask a Member of the House who is at the Dispatch Box whether he practises tax avoidance. That is stretching it a bit far. I am merely quoting from the Treasury’s 2012 policy document, which says that:

“It is hard to predict how quickly the increased scope for tax planning will be exploited”.

The Institute for Fiscal Studies says that there will be a whole new avoidance industry in terms of the capital gains tax on these shares, and in terms of PAYE and national insurance. If Government Members do not believe me, they can listen to what Lord Forsyth—as a Scottish Member of Parliament, I never thought that I would agree so much with him—said last night in the other place:

“I remain concerned as to whether the estimate made that this could result in more than £1 billion disappearing in tax-avoidance schemes is correct. It is not clear to me whether the Treasury has found ways of ring-fencing this scheme, which provides for up to £50,000 of capital gains tax to be relieved, and whether this could not be used as a great tax-avoidance scheme.”—[Official Report, House of Lords, 22 April 2013; Vol. 744, c. 1257.]