Property Taxes

Debate between James Murray and Jerome Mayhew

Wednesday 3rd September 2025 Commons Chamber

[The Chief Secretary to the Treasury (James Murray)]

I thank the right hon. Member for Central Devon (Sir Mel Stride) for opening the debate. I can tell that he spent his summer polishing some of his rhetorical flourishes, which he has shared with us today, but I suggest that he could have spent his time rather better.

Thank you for your words of congratulation, Mr Speaker. It is a real honour to be here as Chief Secretary to the Treasury. May I put on record my tribute to my predecessor, now the Chief Secretary to the Prime Minister, my right hon. Friend the Member for Bristol North West (Darren Jones), for all his fantastic work, notably delivering the spending review? I welcome the Exchequer Secretary to the Treasury, my hon. Friend the Member for Chipping Barnet (Dan Tomlinson), to his new role. I thoroughly enjoyed the role myself, and I am sure that he will be excellent in it.

Conservative Members will appreciate that today’s motion, as tabled, simply cannot form the basis of a specific debate on individual tax measures. Members from across the House will know that the Government do not respond to speculation in advance of a Budget, which the Chancellor has today announced will take place on 26 November. This has long been the case: the shadow Chancellor knows it well and he knows that it would be irresponsible to engage in that speculation. Whatever political rhetoric he and his colleagues will use in today’s debate, and no matter how many variants of the same question they ask, I know that he will understand that I cannot engage with speculation about individual tax measures ahead of the Budget.

[Jerome Mayhew (Broadland and Fakenham) (Con)]

The hon. Gentleman says that he cannot speculate on individual tax measures, but will he deny that the No. 11 machine has been leaking these stories to the national press over the summer?

[James Murray]

I am not going to engage in speculation about tax measures or any of the mechanics around them. The hon. Member and his hon. Friends will simply have to wait until 26 November to hear the specifics of the Budget. At that point, I am sure that he and his colleagues will have plenty to say.

Agricultural and Business Property Reliefs: OBR Costing

Debate between James Murray and Jerome Mayhew

Thursday 23rd January 2025 Commons Chamber

[James Murray]

There still seems to be confusion among Opposition Members about what the OBR publication set out. It reiterates the costings that were published at the time of the Budget, on 30 October. It explains how those costings were arrived at, so that people can understand the calculations behind them, but the costings are the same as those published at the time of the Budget.

[Jerome Mayhew (Broadland and Fakenham) (Con)]

Mr Speaker, if you look at the Register of Members’ Financial Interests, you will see a reference to my family farm in my constituency. Last Sunday, I drove one of our tractors to Fakenham racecourse to support the farmers’ protest against the APR and BPR. I talked to other farmers, and the key complaint was that there had been no consultation on the changes, and no time for older farmers to adjust their affairs. All those concerns have been rubbished by Ministers time and again, most recently today. Now that the OBR confirms that it is more difficult for older people to restructure their affairs quickly, will the Government finally listen, show some humility, and consult on how best to tackle the tax shelterers while still protecting our farmers?

[James Murray]

The comments in the OBR publication yesterday about older individuals reference a point that has been made since the Budget in debates in this place and elsewhere. We have pointed out that our reform of agricultural property relief and business property relief maintains generous exemptions from inheritance tax; £1 million is subject to relief, and there is the 50% relief beyond that, the existing nil-rate bands, and other exemptions in the system.

Finance Bill

Debate between James Murray and Jerome Mayhew

2nd reading
Wednesday 27th November 2024 Commons Chamber

[James Murray]

I will make some progress.

As the Chancellor set out in the Budget, we believe that before making any changes to the tax rates that people pay, it is vital that we do everything we can to close the tax gap. That is why, in the Budget, the Chancellor announced a step change in our ambition to do so, with a package raising £6.5 billion of additional tax revenue by 2029-30. This package will ensure that more of the tax that is owed is paid, and that taxpayers are supported to pay the right tax first time. Our plan involves boosting the capacity of His Majesty’s Revenue and Customs to ensure compliance and reduce debt, alongside changes to legislation, some of which this Finance Bill delivers, to remove loopholes used to reduce tax liabilities.

That is why this Bill includes measures such as introducing capital gains on the liquidation of a limited liability partnership, closing a route increasingly used to avoid paying tax. The Bill reforms rules for overseas pension transfers, closing a gap that allows individuals to transfer significant pension savings overseas tax-free. And the Bill implements the cryptoasset reporting framework, tackling complex compliance cases where a significant proportion of offshore risk sits.

In our manifesto, we said that we would take on the tax gap, and that is what we are doing in government.

[Jerome Mayhew (Broadland and Fakenham) (Con)]

The Minister recognises the importance of reducing the tax gap, so will he commend the previous Conservative Government for halving the tax gap they inherited from Labour in 2010?

[James Murray]

As we all know, efforts to close the tax gap thoroughly stalled under the previous Government, and we have brought renewed focus to this effort. It is one of our top priorities. Before increasing any tax rates, we must ensure that people pay the tax that is owed. Frankly, if the previous Government had been doing such a great job, how is it that our Government have been able to find an extra £6.5 billion to close the tax gap in our first Budget alone? That was in our manifesto, and that is what we are delivering.

In our manifesto, we made other specific commitments on tax, and I will set out now how the Bill seeks to implement them. First, let me turn to non-doms in the tax system. As right hon. and hon. Members will know, this Government believe that everyone who is a long-term resident in the UK should pay their taxes here. That is why this Government are removing the outdated concept of domicile status from the tax system, and why we are implementing a new residence-based regime from 6 April 2025. We have long argued for such a change to be made. Although the previous Government ended up being forced towards our position, they never implemented any changes. Under this Government, we will finally make the reforms necessary to make the system fit for the 21st century.

Our new regime will be internationally competitive and focused on attracting the best talent and investment to the UK. Our reforms will scrap the planned 50% reduction in foreign income subject to tax in the first year of the new regime; introduce a new residence-based regime for inheritance tax; retain and reform overseas workday relief, encouraging employees to spend more of their earnings in the UK; and extend the previously announced temporary repatriation facility to three years, from April 2025.

The new rules mean that, from April 2025, anyone who has been tax resident in the UK for more than four years will pay UK tax on their foreign income and gains, as is the case for other UK residents. That is a much simpler and clearer test than exists under the current regime. The Office for Budget Responsibility confirmed that these reforms will raise £12.7 billion in revenue over the five year forecast period. That funding is crucial for meeting our commitments to fixing the public finances.

Secondly, in government we have decided to go further than our manifesto commitment to increase the non-resident stamp duty surcharge, and we will instead increase the higher rate of stamp duty on additional dwellings, from three percentage points to five percentage points above the standard residential rate. That increase to the higher rate of stamp duty will raise more money than set out in the manifesto—a total of £310 million by 2029-30—and will go further to rebalance the housing market.

The OBR’s certified costing assumes that an increase in the higher rate of stamp duty by two percentage points is expected to result in 130,000 additional transactions over the next five years by first-time buyers and other people buying a primary residence. We estimate that approximately half those who paid a non-resident stamp duty surcharge also pay the higher rates of stamp duty, so the change will improve the comparative advantage of UK resident home movers, while ensuring that no additional barriers are faced by those coming to the UK and buying their main home.

Thirdly, the Bill delivers our manifesto commitment to introduce the 20% standard rate of VAT on private school fees. That will apply to any charges charged on or after 29 July for terms starting after 1 January 2025, and it sits alongside our changes to private schools business rates relief in the Non-Domestic Rating (Multipliers and Private Schools) Bill. Ending tax breaks for private schools is a tough but necessary decision that will secure additional funding to help the Government deliver their commitments to improve education in state schools across the country, and achieve the aspiration that every parent has for a high-quality education for their children.