Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what recent discussions he has had with the Governor of the Bank of England on domestic pressures potentially impacting inflation; and if he will make a statement.
Answered by Andrew Griffith - Minister of State (Department for Science, Innovation and Technology)
Monetary policy is the responsibility of the independent Monetary Policy Committee at the Bank of England. The Government is working closely with the Bank to ensure that monetary and fiscal policy are well coordinated, and fully supports the Bank in their mission to drive down inflation.
Consistent with monetary policy independence, the Chancellor has regular meetings with the Governor of the Bank. Open exchange of views in these meetings is critical for the Government and the Bank to understand each other’s views on the outlook for the economy and monetary and fiscal policy, to support policy making in both institutions. These meetings are therefore confidential.
Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make an assessment of the potential impact of increasing the threshold for the (a) 45 per cent tax rate to £150,000 and (b) 40 per cent tax rate to £60,000 on the public purse.
Answered by Victoria Atkins - Secretary of State for Health and Social Care
The Government must ensure the tax system supports strong public finances and it is right that higher earning households shoulder the most burden.
The additional rate threshold of income tax is set at £125,140 for 2023-2024. This was announced at Autumn Statement 2022 and was taken as part of a number of decisions to support public finances. Only the top 2 per cent of taxpayers are affected by this change.
The higher rate threshold is high enough to protect the vast majority of people from paying the higher rate of income tax. Around 80 per cent of all income taxpayers pay at the basic rate.
The Government’s approach to delivering fiscal sustainability is underpinned by fairness, with those on the highest incomes paying a larger share.
Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make an estimate of the potential impact of reducing (a) corporation tax to 15 per cent, (b) income tax to 18 per cent and (c) capital gains tax to 10 per cent on annual tax receipts.
Answered by Victoria Atkins - Secretary of State for Health and Social Care
Spring Budget 2023 delivers a package of measures that further strengthen the UK’s position as one of the most competitive major economies. The economic and fiscal impact of changes in tax policy are factored into the Office for Budget Responsibility’s forecasts. Further detail is available in the OBR’s Economic and Fiscal Outlook which is published at fiscal events.
The Government keeps the tax system under constant review and the Chancellor has signalled his intention to cut business taxes further when it is responsible to do so.
Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make it his policy to reduce the level of VAT applying to the hospitality sector; and if he will make a statement.
Answered by Victoria Atkins - Secretary of State for Health and Social Care
The previous VAT relief for tourism and hospitality cost over £8 billion.
The Government has been clear that this was a temporary measure designed to support the cash flow and viability of sectors that have been severely affected by COVID-19.
We have continued to support and encourage the hospitality sector through other measures since then. At Autumn Statement 2022, the Government announced a package of changes and cuts to business rates worth £13.6 billion over the next five years, including an increased 75 per cent relief for retail, hospitality and leisure properties, up to a cash cap of £110,000 per business for 2023-2024. This is a tax cut worth over £2 billion for around 230,000 RHL businesses, to support the high street and protect small shops.
The introduction of a small profits rate of Corporation Tax, from April, keeps the rate at 19 per cent for companies with profits of £50,000 or less. This means around 70 per cent of actively trading companies will not see an increase in their Corporation Tax rate. The availability of marginal relief for companies with profits of between £50,000 and £250,000 means only around 10 per cent of actively trading companies will pay the full 25 per cent.
While there are no plans to reduce the rate of VAT paid by hospitality businesses, the Government keeps all taxes under review.
Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what recent assessment he has made of the potential merits of introducing arrivals duty free policies in airports on (a) tax revenue and (b) job creation; and if he will make a statement.
Answered by James Cartlidge - Minister of State (Ministry of Defence)
Duty-free on arrival, which would apply to inbound passengers, would place additional pressure on the public finances to which excise duty makes a significant contribution. Any loss in tax revenue would have to be balanced by a reduction in public spending, increased borrowing or increased taxation elsewhere.
Although there are no plans to introduce such a scheme, the government keeps all taxes under review.
Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what recent assessment he has made of the value of Libyan-owned assets frozen in the UK in each of the last five years for which figures are available; and if he will make a statement.
Answered by Andrew Griffith - Minister of State (Department for Science, Innovation and Technology)
Since its establishment in 2016, HM Treasury’s Office of Financial Sanctions Implementation (OFSI) has undertaken an annual frozen asset review, requiring all persons or institutions that hold or control frozen assets in the UK to report to OFSI, from which the following figures are taken.
The figures are each an approximate total value of frozen Libyan assets in the UK:
September 2017 £12.061 billion
September 2018 £11.222 billion
September 2019 £11.809 billion
September 2020 £11.528 billion
The figures for the 2021 Frozen Asset Review are still being finalised and will be published in OFSI’s Annual Review later this year.
The value of frozen funds in the UK can fluctuate for numerous reasons. These include changes to sanctions designations, changes in share or market values, or certain financial activity being licensed.
Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether he has made an assessment of the effect of the cost of VAT to manufacturers where the Scottish Deposit Return Scheme reaches an 80 per cent bottle return rate; and if he will make a statement.
Answered by Lucy Frazer - Secretary of State for Culture, Media and Sport
The Scottish Government and the Department for Environment, Food and Rural Affairs both intend to introduce deposit return schemes for drinks containers. HMRC is working with them and other stakeholders to ensure the VAT implications of these schemes are understood and is exploring how the VAT regulations may be amended to support the scheme. HMRC will assess the impact of any VAT regulation changes.
Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will provide additional financial support to businesses affected by the postponement of the easing of covid-19 restrictions planned for 21 June 2021; and if he will make a statement.
Answered by Kemi Badenoch - President of the Board of Trade
Throughout the pandemic, the Government has sought to protect people’s jobs and livelihoods while also supporting businesses and public services across the UK.
The Government put in place an economic package of support totalling £352 billion through the furlough and self-employed income support schemes, support for businesses through grants and loans, business rates and VAT relief.
At Budget the Government deliberately went long and erred on the side of generosity – specifically to accommodate any short delay to the roadmap. Most of the Government’s Covid support schemes do not end until September or after, in order to provide continuity and certainty for businesses and families.
The Recovery Loan Scheme (RLS) announced at Budget 2021 ensures lenders continue to have the confidence to lend, ensuring viable businesses, including small businesses, continue to have access to Government-backed finance needed throughout 2021. The scheme launched on 6 April 2021, following the closure of the emergency schemes to new loan applications on 31 March 2021, and will run until 31 December 2021. The scheme operates UK-wide, providing an 80% guarantee to lenders for term loans, overdrafts, and invoice and asset finance.
At Budget, it was also announced that local authorities in England will receive a top-up worth a total of £425m to the Additional Restrictions Grant (ARG) fund. This, combined with the £1.6 billion previously allocated, means local authorities will have received over £2bn of discretionary grant funding to support businesses which are not eligible for Restart Grants but which are nonetheless experiencing a severe impact on their business due to public health restrictions. Nearly half of the £2bn is still with local authorities and yet to be allocated.
The Coronavirus Job Retention Scheme (CJRS) was introduced to help employers whose operations have been severely affected by coronavirus to retain their employees and protect the UK economy. All businesses across the UK can access the scheme, with employees receiving 80% of their usual salary for hours not worked, up to a maximum of £2,500 per month. At Budget the government extended the CJRS until the end of September 2021, to support businesses and employees through the next stage of the pandemic. The economy now is in a stronger position than it was last autumn, when businesses also contributed up to 20 per cent of wage costs.
In line with the extension to the CJRS, the government announced at Budget 2021 that the Self-Employment Income Support Scheme (SEISS) will continue until September, with a fourth and a final fifth grant. This provides certainty to business as the economy reopens and means the SEISS will continue to be one of the most generous schemes for the self-employed in the world.
As restrictions have been lifted, it is right that we ask employers to contribute more to strike the balance between supporting the economy as it opens up, continuing to provide support and protect incomes, and ensuring incentives are in place to get people back to work.
Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what recent assessment he has made of the potential merits of the removal of customs and VAT guarantees for the temporary admission of thoroughbreds to Great Britain for racing and breeding purposes; and if he will make a statement.
Answered by Jesse Norman
Under new rules introduced on 1 January 2021, most businesses no longer need to provide a guarantee if they are granted full authorisation from HMRC for the Temporary Admission procedure in Great Britain. This means that authorised importers of racehorses will generally not be required to provide upfront security for customs and VAT liabilities, and subject to the horses being re-exported as per the Temporary Admission rules, import duties would not become payable.
Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will extend the business rates holiday for hospitality businesses to 1 April 2022.
Answered by Jesse Norman
This year the Government has provided an unprecedented business rates holiday for eligible retail, hospitality and leisure properties due to the direct adverse effects of COVID-19, worth over £10 billion, and has frozen the business rates multiplier for all businesses for 2021-22.
The Government has provided various schemes to support firms, including wholesalers, including Coronavirus Business Interruption Loans, Bounce Back Loans, grants and VAT deferrals.
The Budget will set out the next phase of the Government’s plans to tackle the virus, protect jobs and support business.