Finance (No. 2) Bill (First sitting)

Debate between Oliver Ryan and Mark Garnier

Committee stage
Tuesday 27th January 2026 Public Bill Committees

[Mark Garnier]

Clause 20 will introduce specific exemptions for minor expenses incurred by an employee on behalf of their employer. The Opposition particularly welcome subsections (3) to (6). As the Institute of Chartered Accountants in England and Wales says, it is a positive step that focuses on prevention rather than cures. It is also about the trade-off between tax relief and reduced future healthcare spending.

As the Association of Taxation Technicians has asked, will the Minister consider whether the covid-19 vaccination could be included in this provision? The Government’s explanatory notes state that corresponding changes to NICs for influenza vaccines and homeworking equipment will be made through separate regulations. Will the Minister provide more detail on when we can expect those regulations to be introduced?

On clause 21, the Government’s policy paper suggests that there will be no direct impact on business. However, there may be an indirect impact, as employers feel pressured to change their policies on reimbursement. As the Chartered Institute of Taxation points out:

“This creates an uneven situation in which two employees with identical working arrangements and costs are treated differently for tax purposes solely on the basis of their employer’s reimbursement policy.”

It also seems to follow our party’s scepticism about solely remote working. During the passage of the Employment Rights Act 2025, the Government said repeatedly that the right to work from home boosts productivity. Clause 21 seems to go against that by making it more difficult to work from home. It also seems to be a further attack on private sector employees, despite the fact that in 2024 HMRC spent £82 million on remote working devices for its workers, while the Home Office spent £53 million. Is this another example of the Government hitting the private sector while protecting the public sector?

Clauses 22 and 23 confirm that payments received in Great Britain for cancelled, moved or curtailed shifts are subject to income tax. In the explanatory notes, the Government state that this would also allow for

“the introduction of regulations to ensure that payments are also subject to National Insurance contributions”.

We think it would help to provide fairness in the tax system to support the clarity that the clause provides, so can the Minister confirm when the Government will seek to introduce those specific changes?

More generally, I want to make a point that my hon. Friend the Member for Mid Buckinghamshire (Greg Smith) made on the Employment Rights Bill Committee. While the clause provides fairness in the system between employees, the Government are still providing little support for businesses if they have to cancel, move or curtail shifts in circumstances that are unexpected or out of their control. Will the Minister commit to working with her colleagues in the Department for Business and Trade to assess how they can better support businesses when such situations arise?

[Oliver Ryan (Burnley) (Lab/Co-op)]

As ever, Sir Roger, it is a pleasure to make a short contribution while you are in the Chair. On clause 20, I will not echo the point that has just been made, but the Minister will have seen the written evidence submitted by the Association of Taxation Technicians, which discussed potentially widening the new initiative of including flu vaccinations in expenditure deductible from employment income, so that it also includes covid vaccinations. Has the Minister given that any thought?

On clause 22, it is a pleasure to see the Employment Rights Act being enacted and to address shifts being missed by people on zero-hours contracts, such as those in my constituency. It probably takes us into a wider debate that the Opposition have raised about having oral evidence sessions. It is clear from the evidence pack that the Chartered Institute of Taxation, the Association of Taxation Technicians and other taxation professionals have quite a lot of comments to make. If submissions on the clause were opened to my constituents, I am sure that there would be mass evidence from the public saying how much of a good thing it is. Does the Minister have any comments on that?