Taxation (Energy and Vehicles) Bill

Noah Law Excerpts

2nd reading & Committee of the whole House
Wednesday 1st July 2026 Commons Chamber

[James Wild (North West Norfolk) (Con)]

I know that this legislation is fast-tracked, but the Minister did rattle through very rapidly. I will seek to follow her lead as best I can.

It is a pleasure to debate the Bill on Second Reading and its measures on increasing the electricity generator levy, increasing the mileage allowance and introducing the 12-month HGV vehicle excise duty holiday. We are broadly supportive of the measures. However, we must consider the wider context in which we are debating them. The energy price cap has today increased by 13%, inflation is well above target, economic inactivity is rising, we have high borrowing costs, taxes are at record levels and are set to go higher, and, sadly, growth is non-existent. Those things cannot all be blamed on the conflict in the middle east, so it is little wonder that this zombie Government are under pressure to show that they have a plan for energy costs, business costs and the strain on ordinary family finances.

Given the title of the Bill, people might expect ambitious measures in it to deliver cheaper energy for consumers and businesses, make our economy more competitive, and unwind the bills, levies and targets that are increasing costs, but there are not. Instead, this is a small package of measures with no serious plan to ease the burden.

[Noah Law (St Austell and Newquay) (Lab)]

The shadow Minister speaks of the need for ambition, but does he not agree that there is little that is more ambitious than breaking the link between the cost of gas and electricity, which so many of our constituents have called on us to do in recent months?

[James Wild]

I agree with the hon. Gentleman on that point, which I will come to shortly. I just note that when the Secretary of State for Energy Security and Net Zero had the opportunity to really break that link, he backed away from doing so. This measure does so in a limited way, but it does not make the ambitious reforms that could have been made by the Energy Secretary.

The electricity generator levy—[Interruption.] I am sure the Parliamentary Private Secretary, the hon. Member for Hitchin (Alistair Strathern), can intervene if he is allowed. The electricity generator levy was introduced by the previous Government in 2023 as a temporary windfall tax applying to revenue above the benchmark price. It was a short-term response to exceptional circumstances and is due to end in 2028. What do the Government propose? To increase the rate from 45% to 55% and to extend it beyond 2028, with no end date. This is another example of Ministers reaching for higher taxes while offering no certainty in return.

The Government say, to answer the point made by the hon. Member for St Austell and Newquay (Noah Law), that the increased rates will support the decoupling of gas prices by incentivising generators into voluntary wholesale contracts for difference, but while the new higher levy applies from today, those new contracts are yet to be seen, the proposed strike price is not known, the likelihood of generators accepting them is therefore unknown and in question, and the value for money for taxpayers is yet to be proven. Will the Energy Secretary still be in post to oversee the reforms? We all sincerely hope he will not be in the Treasury.

In the winding-up speech, will the Minister provide an update on when the consultation on the CfDs will be launched, when the first contracts are set to be awarded, and if that will be through an auction or an allocation round? The Government have said that their intention is to extend the levy beyond 2028, but with no clarity on when it will end. The Government do not know how long they want it to last and have said there will be further legislation on that point. The Exchequer Secretary, in the debate on the resolutions last week, said that this was something “the Government are considering”. That is hardly a robust approach when bringing legislation before the House. Indeed, it seems like a hasty measure to give the Chancellor something to announce.

The House of Lords Constitution Committee previously recommended that for fast-track legislation, sunset clauses should be the default presumption. An amendment to add one is outside the resolutions of this House, but we have tabled a new clause that would require the Government to come forward before the due end date in March 2028 to say whether they think the levy should continue.

There is an absence of any publicly available costings on the measures. That is true for all the measures, yet this House is being asked to approve an indefinite extension. When the levy was first introduced, the Office for Budget Responsibility predicted that it would raise £2.3 billion a year, but the out-turn in 2024-25 was only £700 million. That matters, because part of the rationale for the higher levy is to generate revenues to support businesses and households. What measures is the Minister proposing in that regard? Surely not the Thorpe Park VAT cut, because that is funded by changes to corporation tax. Can the Minister enlighten us on what other benefits the consumers—my constituents—are getting from the tax?

The levy needs to be seen in the context of the Government promising to reduce energy bills by £300—instead, bills have increased by around that amount. That is what happens when Governments do not have a plan. The Conservatives would cut bills for businesses and consumers through our cheaper energy plan, taking VAT off energy bills, axing the carbon tax and legacy subsidies, and backing the North sea to get drilling.

The second measure on increasing mileage payments to 55p for 10,000 business miles is something that we support. It is right that those workers, including carers, who are using their own vehicles for work should not be left to absorb the rising cost. The measure is backdated to the start of the financial year. When winding up, can the Minister guarantee that His Majesty’s Revenue and Customs will not pursue anyone for any income tax or national insurance contributions that may otherwise have arisen on payments made before the legislation took effect?

The increase applies only to the first 10,000 miles. When we debated the resolution, the Minister said that the Government considered an increase in the 25p rate, but that it did not represent good value for money. If Ministers accepted that the 45p rate needed to be increased, can the Minister explain how they justify leaving the longer-distance rate untouched at 25p? As has been set out, this is the first increase for some time, which raises the question of how we can avoid such a long period between increases in future. I accept that indexation would be complicated, but what commitments will the Minister make to regularly review increases?

Mileage is an important part of motorists’ costs, but the bigger impact comes from fuel duty. At the last Budget, the Chancellor announced plans to scrap both the 15-year freeze and the 5p cut that the Conservatives put in place. It was only after pressure from the Opposition that the Chancellor made a U-turn. However, it was only a partial one, and those costs are going to start hitting from as soon as January. For the logistics sector, which pays £5.4 billion in fuel duty, a 1p increase per litre will increase costs by nearly £83 million. Perhaps the new Chancellor will recognise the folly of that approach and reverse the plans they inherit.

We welcome the HGV vehicle excise duty holiday. That duty had been frozen since 2014 until Labour came into office. For a year from today, HGVs will pay just £1, which will be a significant saving for the sector. However, the Government must recognise the full scale of the pressures facing hauliers and accept responsibility for those they have added; the Chancellor did not have to increase business rates, transport taxes and fuel duty.

More than 95% of road haulage firms are small businesses with small margins, so any increase in costs is a challenge. The Government say that the measure will save £600 for a typical lorry, and £900 for the largest vehicles. At peak prices, filling a single HGV costs more than £1,000. Yes, the measure is helpful, but not markedly so.

Taken together, the measures reveal a Government reaching for short-term fixes while avoiding the harder questions. On the generator levy, they are demanding higher taxes without certainty or proper costings—all while displaying a lack of urgency on reforms to decouple energy prices. Mileage allowances are a partial change, and one that leaves high-mileage workers behind. The vehicle excise duty holiday is a temporary relief without a plan for what comes next.

The Conservatives welcome the measures, as far as they go. However, they have not been brought forward by choice; they have been forced by the consequences of the Chancellor’s decisions. Taxes remain at record highs, and are set to go higher, costs continue to rise, and growth has stalled. Against that backdrop, the measures offer very limited relief.

Tolled Crossings and Regional Connectivity

Noah Law Excerpts

Monday 2nd February 2026 Commons Chamber

[Anna Gelderd]

I wholeheartedly agree with that sentiment. This interaction between defence, regional connectivity, transport and what we are looking to achieve down in the south-west really needs cross-governmental consideration.

This goes beyond defence, with Cornwall reviving its mining heritage through the development of critical minerals, recognised through Labour’s Kernow industrial growth fund, supporting cleaner energy supplies and economic independence, and backing British business. Cornwall also has major international cultural and tourism value, from our historic landscapes and mythical legends to world-leading attractions, such as the Eden Project. Our food culture, from cream teas to Cornish pasties, has global appeal—something I have seen at first hand.

[Noah Law (St Austell and Newquay) (Lab)]

I refer to my entry in the Register of Members’ Financial Interests. I thank my hon. Friend for giving way on Cornwall’s economic potential and particularly the role of critical minerals. Does she agree that in an ideal but not unimaginable world, we would have electric ferries, ideally powered by Cornish lithium batteries, which would reduce the operating costs of those ferries and therefore the subsidy effectively paid by Tamar bridge users to support that service?

[Anna Gelderd]

My hon. Friend’s intervention goes to the heart of this question: how do we move communities like ours into the future, taking advantage of cleaner, greener and cheaper sources of energy, and bringing down costs for local residents?

The Plymouth defence deal presents a real opportunity. The tolled crossings are enabling infrastructure and backing resilience. Addressing them alongside defence investment aligns local fairness with our national priorities. Such strengths deserve an infrastructure that enables growth, rather than one that holds it back.

Cornwall is modernising, our economy is evolving and our ambitions are forward-looking. That brings me to my first three points, which are focused on improving fairness and future-proofing the Tamar crossings. First, we need to devolve the necessary powers. Current legislation limits the ability of local authorities to reform tolling structures in line with modern use. Devolving those powers would enable local decisions aligned with our national objectives. Secondly, we need grant funding to support long-term reform. Removing or reducing tolls without replacement revenue risks shifting the burden on to local authorities and council tax payers. Grant funding would recognise the national benefit and avoid unintended consequences. Thirdly, we need debt relief linked to historical financing. Existing debt structures drive continued reliance on toll income and restrict future options. Addressing this legacy debt would allow the crossings to come into the 21st century.

On the wider picture of unlocking our potential, my fourth point is on safety and resilience of the A38. This is the main road through South East Cornwall. With continued action and investment following recent safety upgrades, we can ensure that the route is even more resilient. Fifthly, we must strengthen rail resilience and access through Dawlish. Cornwall’s rail connectivity depends on that single, climate-vulnerable line. To ensure regional growth, we need a strategic rail plan and phase 6 of the Dawlish resilience programme. Finally, we must improve digital connectivity across South East Cornwall. Reliable, high-quality broadband and mobile coverage are needed throughout the area.

Together, the measures I suggest provide a credible route towards resolving a long-standing issue. I urge the Minister to engage with myself and with neighbouring colleagues, many of whom are here today, to recognise the role that the Tamar crossings play in regional connectivity in terms of national defence, food production and regional economic growth, and to work with local partners to deliver fair and modern reform. With those powers held locally, fair funding and a long-term vision, we can move at pace to fulfil the potential that we see through the infrastructure that we, on both sides of the Tamar, rely on day by day.

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[Noah Law]

The hon. Member makes an important point about the lack of National Highways funding for the bridge, but does he share my delight at the £220 million investment coming into Cornwall’s roads from national Government? We are seeing record-breaking investment in our roads, but that is not to detract from the point he makes about the lack of funding for the Tamar bridge.

[Ben Maguire]

I thank the hon. Gentleman for his intervention, and hopefully he and I can make the argument to the Minister and her colleagues that some of that money should go to the Tamar bridge.

There are certainly other road projects across Cornwall. The hon. Member for South East Cornwall spoke passionately about the A38, which my constituents frequently raise with me, and hopefully that is another project that can be funded from the large amount of money we are hearing is coming to Cornwall’s road network. There are also much-needed safety upgrades at Plusha in my constituency. I have met the Minister on numerous occasions, so I know she is aware of the upgrades to the Camelford relief road, which have been promised for many years.

As I have mentioned, I really hope that a devolution deal will now be forthcoming in which we see the equivalent of the Cornish proportion of the strategic road network, which is around £96 million a year. This evening, we have talked about making the Tamar toll crossing cheaper for local residents, or potentially removing the toll altogether at a cost of around £15 million a year. In their devolution deals, our Celtic cousins enjoy a budget equivalent to the amount of the road network they have in their nations, and that would leave plenty of money left over for the A30 upgrade that the hon. Member for South East Cornwall mentioned, and for lots of other upgrades across Cornwall.

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[Perran Moon (Camborne and Redruth) (Lab)]

I want to make a few short points to expand on a couple of things that have been mentioned. I thank my hon. Friend the Member for South East Cornwall (Anna Gelderd) for securing this important debate.

As I have said to several Members, particularly from this part of the world, we are currently closer to Middlesbrough than to my constituency in Camborne. Indeed, when people in this country think about the south-west, they think of Bristol, which is closer to Manchester than to my constituency. That gives an idea of the scale of where we are.

When it comes to the important question of regional connectivity, I gently say to the Minister that, over the last 18 months, the Government have invested over £100 million in Cornish metals, Cornish lithium and, as we have heard, the Kernow industrial growth fund. To maximise the potential of that investment, it is essential that we have the transport infrastructure to support it, including in the Tamar crossing.

[Noah Law]

If we are taking a local growth approach, which I know is so important to our Government, surely a deal for the Tamar must be a crucial part of any devolution arrangement.

[Perran Moon]

My hon. Friend is absolutely right. The Tamar bridge should form part of our needed package of transport support, including mainline rail, upgrades to the A30 and, importantly, a complete review of the funding model for our one regional airport at Newquay, which needs to be considered in the round.

My hon. Friend the Member for South East Cornwall spoke about car ownership in Cornwall. One of the gross distortions of the Westminster funding modelling is that we look at car ownership as an indicator of affluence. In Cornwall, it is quite the opposite. Our public transport systems are so poor that we have one of the highest car ownership rates in the country per capita. The reason is that many people in large swathes of Cornwall—particularly young people who need to get to college, or who need to develop the skills to work in some of the organisations I have mentioned—are completely housebound and isolated if they do not own a car. As my hon. Friend mentioned, it also contributes to the real problems of loneliness and lack of access to social groups, which is important for people’s mental health.

There are wide-ranging issues with the lack of connectivity across Cornwall. That is why it is so important, as the hon. Member for North Cornwall (Ben Maguire) mentioned, that our devolution arrangement considers the implications of our remote coastal geography for business development, for young people and the skills they need, and for the social aspect as our population ages and more young people sadly leave Cornwall because they cannot find work, particularly driven by our acute housing crisis. We need a holistic strategy for the whole of Cornwall, and a very important part of that is the Tamar crossing.

Agricultural Property Relief and Business Property Relief

Noah Law Excerpts

Monday 5th January 2026 Commons Chamber

[Noah Law (St Austell and Newquay) (Lab)]

I thank the Minister for his considered engagement with rural Labour MPs such as myself on this issue from the get-go. I also thank farmers—at least in my part of Cornwall—for their dignified engagement at what I know has been a difficult time. Does the Minister agree that where we have landed now strikes a much better balance, one that in relative terms favours small family farms compared with industrial concerns, institutional investors and those looking to use agricultural property as a means of avoiding tax?

[Dan Tomlinson]

I thank my hon. Friend for his continued engagement on this and a whole range of issues that affect rural communities in Cornwall—he is a strong advocate for his constituents. As he says, we have now come forward with a change in the APR and BPR thresholds to make sure we can protect those smaller family farms.

Oral Answers to Questions

Noah Law Excerpts

Tuesday 9th December 2025 Commons Chamber

[James Murray]

I welcome the hon. Gentleman drawing attention to the importance of productivity in the UK economy and our prospects for growth. As we know, the Office for Budget Responsibility reviewed the productivity impact of the previous Government’s record in office and found that the decisions they had taken over those 14 years meant that we had a £16 billion revenue hit to the public finances in the target year of the scorecard. We know that means that productivity has been downgraded as a result of decisions taken by the previous Government, but that gives us an opportunity—an opportunity to not be held back by the failures of the previous Government and to exceed those forecasts in future.

[Noah Law (St Austell and Newquay) (Lab)]

Cornish communities and small and medium-sized enterprises in the supply chains of Cornwall’s most promising industries alike will have been delighted by the Chancellor’s announcement of the Kernow industrial growth fund in the recent Budget. Does the Chief Secretary to the Treasury agree that those funds should be invested prudently and sustainably and that the proceeds should be recouped for the Cornish public’s coffers so they can be invested in future projects?

[James Murray]

My hon. Friend and many of his neighbouring MPs are excellent advocates for Cornwall and for the benefits that Cornwall can bring to growth, both in the region and right across the country. I know that, in the Budget, the Chancellor was keen to support investment in future industries in Cornwall. For the local council to deliver that, we will work closely with it to make sure that money is well spent. The key thing for us is to ensure that we enable people in Cornwall to be part of the economic growth mission of this Government.

Office for Budget Responsibility Forecasts

Noah Law Excerpts

Monday 1st December 2025 Commons Chamber

[James Murray]

I will come to the Dispatch Box and say that this Government take the Budget process and their responsibilities to this House incredibly seriously. As the permanent secretary has set out, he places the utmost weight on Budget security. As I have said to several hon. and right hon. Members, the permanent secretary will continue to keep all aspects under review to ensure the integrity of the Budget process.

[Noah Law (St Austell and Newquay) (Lab)]

Does my right hon. Friend agree that some of the real-world and market impacts we saw last week underscore the importance of following proper process with the OBR? We saw the evidence to the contrary just three years ago, when the then Government chose to ignore and bypass the OBR entirely, causing interest rates and mortgage costs to soar.

[James Murray]

I thank my hon. Friend for drawing a comparison between the way in which we as a Government interact with the OBR and the way in which the Liz Truss Government interacted with the OBR. We value the independence of the OBR and the constructive relationship that we have had with it over the past 16 months. That is in stark contrast with the previous Government, who sidelined the OBR and caused economic chaos for families across the country.

Taxes

Noah Law Excerpts

Wednesday 12th November 2025 Commons Chamber

[Sir Mel Stride]

My right hon. Friend makes an extremely incisive and correct point. If a Government spend huge amounts of money, there is an opportunity cost to that and it comes through in various forms, including, as he rightly says, raising the cost of capital and crowding out labour, skills and so on. It is a fine and important balance to get right and this Government, palpably, have got it wrong.

[Noah Law (St Austell and Newquay) (Lab)]

The hon. Member for Hinckley and Bosworth (Dr Evans) makes a fair point. When raising public revenue, one should at least expect a decent return on that spend, whether it be a social return or otherwise. Does the right hon. Member not consider investing in our NHS to be such a decent return?

[Sir Mel Stride]

The hon. Gentleman’s question identifies the core of the fallacy of his Government’s approach, which is to assume that getting better outputs is all about spending ever more money. It is not. It is about what you do with that money; it is about productivity. One of the Government’s many mistakes when they came to office was to splash out on pay rises for their trade union paymasters—14% for the railways drivers and 22% for the junior doctors—with not one string attached in terms of improved productivity. Therein lies the answer to the hon. Gentleman’s question.

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[Noah Law]

I thank the right hon. Gentleman for giving way again. Will he acknowledge the massive dead-weight loss caused by the strikes that were going on, unbelievably, under the previous Government, and the negative returns as a result of the previous Government’s actions?

[Sir Mel Stride]

I am surprised that the hon. Gentleman would follow up what was not the strongest first question with that.

The Government are naive enough to think that by simply buying people off with no strings attached, the problem would go away. It is like feeding meat to the wolf: when the wolf is fed meat, it will come back to the door the next day, and that is precisely what has happened here. Industrial relations are not improving at the moment. We have various unions in the public sector threatening to strike, including in the NHS, where the hon. Member for St Austell and Newquay (Noah Law) started in his first question.

Where has all this led? It has led to lower growth. No matter how much those on the Front Bench may trumpet increased growth, the reality is that growth per capita—[Interruption.] The hon. Member for Bishop Auckland (Sam Rushworth) says it is the highest in the G7, but our growth per capita is the second lowest in the G7. What matters is growth per capita, because that is what drives an improvement in living standards. [Interruption.] I have more bad news for the hon. Gentleman, who continues to chunter from a sedentary position: the IMF says that growth per capita will deteriorate even further next year and be the lowest in the G7.

Oral Answers to Questions

Noah Law Excerpts

Tuesday 4th November 2025 Commons Chamber

[James Murray]

We very much recognise the role that grassroots music venues play in constituencies right across our country. In our reforms, on which we will set out more detail at the Budget on 26 November, we will have permanently lower business rates for retail, hospitality and leisure premises, with rateable values below £500,000.

[Noah Law (St Austell and Newquay) (Lab)]

Despite representing only around 9% of the UK’s economic output, the retail and hospitality sectors contribute around a third of all business rates paid. Does the Minister agree that high streets such as that in St Austell are public goods, and will he ensure that independent small businesses such as those he has described, which are central to our communities and economies, are no longer penalised by an arcane business rates system that undervalues their public contribution?

Taxes

Noah Law Excerpts

Tuesday 15th July 2025 Commons Chamber

[Sir Mel Stride]

My right hon. Friend is absolutely right. When it comes to criticising this Government, it is always confusing whether to address those on the Front Bench or on the Back Benches, because they are never quite in the same place.

The big mistake that the Government made was to talk down the economy by going on about this confected black hole of £22 billion—something that the Office for Budget Responsibility has already debunked. The Government should stop using that number. They are the ones who created a black hole of some £6 billion, as I have just set out, and they should focus not on the black hole that they have invented, but on the one they have created. It is that black hole that is creating speculation across the summer about what will happen in autumn, damaging confidence and damaging businesses up and down the country.

[Noah Law (St Austell and Newquay) (Lab)]

Does the right hon. Gentleman accept that regardless of the actual size of the black hole left by the previous Government, it is a significantly larger number than the one he is talking about with respect to the welfare bill?

[Sir Mel Stride]

I am not sure that I fully understood the point, but the hon. Gentleman seems at least to accept that there is a real black hole when it comes to this Government, of at least £6 billion.

Oral Answers to Questions

Noah Law Excerpts

Tuesday 1st July 2025 Commons Chamber

[Rachel Reeves]

We are increasing transport investment by 1.9% in real terms after HS2 in every year of the spending review period. We are also extending the bus fare cap, which is particularly beneficial to rural areas.

[Noah Law (St Austell and Newquay) (Lab)]

T10.   I believe that redistribution should be core to everything that we do. It is core to the toughest decisions that we have had to make, and it is core to our efforts to achieve growth. Does the Chancellor agree that putting more pounds into the pockets of those with the lowest incomes is the best thing we can do to grow our economy?

Finance Bill

Noah Law Excerpts

Report stage
Monday 3rd March 2025 Commons Chamber

[James Wild]

My right hon. Friend makes the point that this measure may have been introduced by a Chancellor who did not actually understand the impact it was going to have. The Government should have stuck to the promise they made at the election not to increase national insurance at all.

New clause 2 concerns the Government’s plan to undermine our energy security by increasing the energy profits levy to 38%, bringing the headline rate on oil and gas activities to 78%, extending the tax by a year and removing investment allowances. The consequences are fairly predictable. Offshore Energies UK has said that the hike will choke off billions of pounds of investment in the North sea, putting 35,000 jobs at risk.

[Noah Law (St Austell and Newquay) (Lab)]

Does the hon. Member not agree that if such a rate is good enough for Norway, a clean energy superpower, it is good enough for the United Kingdom?

[James Wild]

In short, no, I do not, which is why we voted against that previously. We should be maximising our home-grown energy, not undermining domestic production and choosing to rely instead on importers with higher carbon emissions.

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[Sir Ashley Fox (Bridgwater) (Con)]

This Finance Bill implements the 2024 autumn Budget. That was a bad budget and this is a bad Bill. It punishes businesses, discourages entrepreneurship and raises taxes on those trying to make a living. It will lead to job losses, reduced investment and higher prices. It will lead to higher interest rates and higher Government debt, which will lead to lower growth. If we wanted to make a list of things that our economy did not need, this Finance Bill would be a good starting point.

The Bill is built on broken promises. The amendments tabled try to help the Government to keep their manifesto promises. During the election, Labour told the public that its plans were fully costed and fully funded. Its manifesto said that it would increase spending by £11 billion, so how can the Government now justify an increase in spending of £70 billion a year funded by an extra £40 billion in taxes and £30 billion in borrowing? Even if people believe the fairy story of the black hole told by Labour Members—I do not—£11 billion plus £22 billion does not equal £70 billion.

Is not the truth that the Labour party always planned a large increase in taxes and borrowing but did not have the courage to tell the British people in advance? The Chancellor and the Prime Minister insisted that working people would be protected, but it is now clear either that they were wrong or that they do not consider small business owners, publicans or farmers to be working people.

[Noah Law]

Does the hon. Member not recognise that one of the primary challenges faced by the sectors he mentions is that of workers’ inability to afford to live in the areas where they work, such as in Cornwall, and that the changes to stamp duty land tax will go a long way towards improving the ability of workers to be housed in what are currently, in so many cases in Cornwall, second homes? Does he not recognise the potential contribution of that to the workforce?