New Businesses: Capital Gains Tax

Lord Tunnicliffe Excerpts

Wednesday 20th January 2021 Lords Chamber

[Baroness Penn (Con)]

I absolutely agree with the noble Lord’s sentiment about the importance of entrepreneurs and businesses to the country’s recovery. As I said to my noble friend earlier, the Government always consider the need to balance raising revenue with the principles of fairness and market efficiency. However, I cannot deny that, in future years, we will have some difficult decisions to take on balancing the books and recovering from the pandemic.

[Lord Tunnicliffe (Lab) [V]]

My Lords, that the Office of Tax Simplification deemed it necessary to split the findings of its review into two reports serves only to highlight the complexities and risks of tax reform. The Government often warn of the perils of unintended consequences; this has certainly been the case with previous iterations of capital gains tax. Does the Minister agree that it is vital to remain mindful of the potentially significant behavioural changes and wider economic impacts that may result from seemingly small changes to tax policy?