Asked by: Rosena Allin-Khan (Labour - Tooting)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what steps she is taking to ensure that large corporations pay the correct amount of tax.
Answered by James Murray - Exchequer Secretary (HM Treasury)
HM Revenue and Customs’ (HMRC) Large Business team manages the tax compliance of the UK’s 2,000 largest businesses through a resource intensive Customer Compliance Manager (CCM) model because their tax at stake, their size and complexity mean that this is the most cost-effective way of ensuring they pay the right amount of tax. This approach is in line with international best practice on cooperative compliance.
CCMs are senior, highly trained compliance professionals, who lead teams of skilled specialists to scrutinise HMRC’s large business customers. This gives an in-depth knowledge of the business and the economic and commercial environment in which it operates, its appetite for tax planning and its internal governance, which allows HMRC to effectively identify and tackle tax compliance risk and ensure the right amount of tax is paid.
The UK Tax Gap in 2022 to 2023 (Measuring Tax Gaps 2024 Edition) was £39.8bn or 4.8% of total theoretical tax liabilities. The element of the Tax Gap relating to large businesses in 2022 to 2023 was £4.3bn (or 0.5% of the UK’s total theoretical liabilities) decreasing from £7.4bn (or 1.7% of the UK’s total theoretical liabilities) in 2005 to 2006. Whilst the UK tax gap for large businesses remains low (the latest figures showing this customer segment pays over 99% of its theoretical liabilities), HMRC continues to take a risk-based approach, focusing resources to close the Tax Gap.
HMRC subjects large businesses to an exceptional level of scrutiny, investigating around half of the UK’s largest businesses at any given time
As of 31 March 2024, HMRC’s tax under consideration for large businesses was £44.9 billion. Tax under consideration is an estimate of the amount at stake in open enquiries, which demonstrates that HMRC is very actively challenging large businesses on tax that may be due.
During 2023 to 2024, by effectively policing the tax rules as they apply to large businesses, HMRC successfully achieved compliance yield of £11.4bn
Asked by: Rosena Allin-Khan (Labour - Tooting)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if she will make an estimate of the amount of corporation tax lost due to tax (a) evasion and (b) avoidance during the current financial year to date.
Answered by James Murray - Exchequer Secretary (HM Treasury)
HM Revenue and Customs (HMRC) estimates the size of the tax gap, which is the difference between the amount of tax that should, in theory, be paid to HMRC, and what is actually paid. The tax gap statistics are published annually. The latest estimates are available at: Measuring tax gaps 2024 edition: tax gap estimates for 2022 to 2023 - GOV.UK (www.gov.uk).
In the tax year 2022 to 2023 the tax gap for Corporation Tax gap was 13.9% of the total theoretical Corporation Tax liability, or £13.7 billion in absolute terms. The amount of the Corporation Tax gap in 2022 to 2023 due to evasion is estimated to be around £2.9 billion, and due to avoidance, around £1.0 billion.
Asked by: Rosena Allin-Khan (Labour - Tooting)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment she has made of the potential merits of basing eligibility for Free Childcare For Working Parents on household rather than individual income.
Answered by Darren Jones - Chief Secretary to the Treasury
Eligibility is assessed on a per person rather than per household basis because the application is made by the individual, it aligns to the existing boundary in the tax system and means there is no incentive for the lower earner in the household to reduce their income in order to be eligible. The eligibility criteria are kept under review.
Asked by: Rosena Allin-Khan (Labour - Tooting)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether she has made an assessment she has made of the potential merits of extending (a) a discount on and (b) an exemption from vehicle excise duty to people receiving Attendance Allowance.
Answered by James Murray - Exchequer Secretary (HM Treasury)
The Government is committed to supporting disabled people and is determined that support should be focused on people who need it most. The aim of existing Vehicle Excise Duty (VED) exemptions for recipients of some disability benefits is to provide additional help for people who become disabled early, or relatively early, in life and as a result experience economic disadvantage. These allowances are therefore only available to people who become disabled before State Pension age.
For individuals who develop a disability after State Pension age, Attendance Allowance (AA) is a non-means-tested benefit which provides targeted help with the extra costs of disability and helps them maintain their independence. Unlike Disability Living Allowance and Personal Independence Payment, AA does not have a mobility component and is intended to cover the need for care or supervision an individual requires as a result of their disability rather than specific mobility needs. Individuals can however choose to use their AA to fund mobility aids.
The Government keeps all taxes under review as part of the policy making process, and the Chancellor makes decisions at fiscal events in the context of public finances.
Asked by: Rosena Allin-Khan (Labour - Tooting)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether she plans to review the Equitable Life payment scheme.
Answered by Tulip Siddiq
The Equitable Life Payment Scheme has been fully wound down and closed since 2016, and there are no plans to reopen any decisions relating to the Payment Scheme or review the £1.5 billion funding allocation previously made to it. Further guidance on the status of the Payment Scheme after closure is available at: https://www.gov.uk/guidance/equitable-life-payment-scheme#closure-of-the-scheme.
Asked by: Rosena Allin-Khan (Labour - Tooting)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, how much his Department has paid in compensation to affected Equitable Life policyholders as of 8 February 2024.
Answered by Bim Afolami
The Government allocated £1.5 billion to the Equitable Life Payment Scheme. Before it ceased operations in 2016, the Scheme issued £1.12 billion in tax-free payments to nearly 933,000 policyholders. The remainder of the £1.5 billion has been set aside for future payments to the With-Profits Annuitants. Further information is available in the Final Report on the Scheme. (https://www.gov.uk/government/publications/equitable-life-payment-scheme-final-report).
At 31 December 2023, the total value of payments made by the Equitable Life Payment Scheme was £1,330,835,466.52.
Asked by: Rosena Allin-Khan (Labour - Tooting)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, how many times officials in his Department have met affected Equitable Life policyholders in the last 12 months.
Answered by Bim Afolami
The Government allocated £1.5 billion to the Equitable Life Payment Scheme. Before it ceased operations in 2016, the Scheme issued £1.12 billion in tax-free payments to nearly 933,000 policyholders. The remainder of the £1.5 billion has been set aside for future payments to the With-Profits Annuitants. Further information is available in the Final Report on the Scheme. (https://www.gov.uk/government/publications/equitable-life-payment-scheme-final-report).
At 31 December 2023, the total value of payments made by the Equitable Life Payment Scheme was £1,330,835,466.52.
Asked by: Rosena Allin-Khan (Labour - Tooting)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what his Department's planned timescale is for returning to spending 0.7% of Gross National Income on Official Development Assistance.
Answered by Laura Trott - Shadow Secretary of State for Education
The Government remains committed to returning to a target of spending 0.7% of GNI on ODA when, on a sustainable basis, the government is not borrowing for day-to-day spending and underlying debt is falling.
Asked by: Rosena Allin-Khan (Labour - Tooting)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will publish a breakdown of the specific spending on the plan to increase the availability of mental health and musculoskeletal resources and expand the Individual Placement and Support scheme.
Answered by John Glen
The breakdown of spending on mental health and musculoskeletal resources, and employment advisors in health settings, including expansion of Individual Placement and Support, announced at Spring Budget 2023 is set out in the Budget document which is available here: Spring Budget 2023 (publishing.service.gov.uk) (lines 12 and 13, Table 4.1 on page 76). The figures in the table have been adjusted to include Barnett consequentials.
Asked by: Rosena Allin-Khan (Labour - Tooting)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, with reference to the Mental Health Breathing Space Scheme, how many people (a) have accessed that scheme in each year to 30 June 2022 and (b) are estimated to access that scheme in the next 12 months.
Answered by Lucy Frazer
The Insolvency Service publishes official statistics on the breathing space scheme as part of its Monthly Insolvency Statistics series, available at: https://www.gov.uk/government/collections/monthly-insolvency-statistics.
In the period from 4 May 2021 (when the scheme started) to 31 May 2022, there were 1,123 mental health breathing space registrations.
Data for June 2022 will be published in mid-July.
HM Treasury has not produced up-to-date estimates for the number of mental health breathing space registrations expected in the next 12 months.