Budget Resolutions

John Bercow Excerpts

1st reading: House of Commons
Tuesday 28th November 2017 Commons Chamber

And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

[Mr Speaker]

I inform the House that I have not selected amendment (a).

--- Later in debate ---

[Elizabeth Truss]

Absolutely, which is why our focus is on getting the best possible deal in the Brexit negotiations. Maintaining a tight grip on Government finances is, as my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke) pointed out, vital for any Government, and Opposition Front Benchers would do well to look at that when they are considering—[Interruption.] I see that the shadow Chancellor is on his iPad looking up what the—[Interruption.] I can help him out without an iPad. His plans would mean an additional half a trillion pounds-worth of debt. If hon. Members want to know how much extra interest the British public would have to pay every year, I can tell them that it is £7 billion. I do not need an iPad to know that.

This Government are prioritising our country’s long-term growth prospects. We are investing in the infrastructure and in the skills that our country needs to succeed. Whatever the Opposition say, it is not politicians or Whitehall that will turbo-charge our economy and bring the growth and improved living standards we all want; it is the enterprises up and down the country that are going to deliver that. The Opposition want to tax new industry to the hilt or, even worse, to run it themselves. I cannot think of a more scary prospect for businesses across Britain. We take the opposite view; we want to unleash enterprise and to make sure that businesses have the people, space and the conditions to succeed. This is a Budget that recognises where the true value of our economy is created. It is not through issuing blank cheques that we cannot afford, but by making sure that our enterprises have the skills, talent and space that they need to grow and to ensure that all our citizens benefit from our powerhouse future. That is why the House should support the Budget in the Lobby tonight.

Question put and agreed to.

Resolved,

That income tax is charged for the tax year 2018-19.

And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

[Mr Speaker]

I am now required under Standing Order No. 51(3) to put successively, without further debate, the Question on each of the Ways and Means motions numbered 2 to 44, on which the Bill is to be brought in. These motions are set out in a separate paper distributed with today’s Order Paper.

I must inform the House that, for the purposes of Standing Order No. 83U, with which I feel sure all colleagues are personally and closely familiar, and on the basis of material put before me, I have certified that in my opinion the following founding motions published on 22 November 2017 and to be moved by the Chancellor of the Exchequer relate exclusively to England, Wales and Northern Ireland and are within devolved legislative competence: motion 3, on income tax (main rates); motion 35, on stamp duty land tax (higher rates for additional dwellings); and motion 36, on stamp duty land tax (relief for first-time buyers). Should the House divide on any of these motions it will be subject to double-majority voting.

The Speaker put forthwith the Questions necessary to dispose of the motions made in the name of the Chancellor of the Exchequer (Standing Order No. 51(3)).

2. CORPORATION TAX (charge for financial year 2019)

Resolved,

That (notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills) provision may be made taking effect in a future year charging corporation tax for the financial year 2019.

3. Income tax (MAIN RATES)

Resolved,

That for the tax year 2018-19 the main rates of income tax are as follows—

(a) the basic rate is 20%,

(b) the higher rate is 40%;

(c) the additional rate is 45%.

And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

4. Income tax (Default and savings rates)

Resolved,

(1) That for the tax year 2018-19 the default rates of income tax are as follows—

(a) the basic rate is 20%,

(b) the higher rate is 40%;

(c) the additional rate is 45%.

(2) That for the tax year 2018-19 the savings rates of income tax are as follows—

(a) the basic rate is 20%,

(b) the higher rate is 40%;

(c) the additional rate is 45%.

And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

5. Income tax (starting rate limit for savings)

Resolved,

That section 21 of the Income Tax Act 2007 (indexation) does not apply in relation to the starting rate limit for savings for the tax year 2018-19 (so that, under section 12(3) of the Income Tax Act 2007 as amended by section 4 of the Finance Act 2017, that limit remains at £5000 for that tax year).

And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

6. Transferable tax allowance

Resolved,

That—

(1) Chapter 3A of Part 3 of the Income Tax Act 2007 (transferable tax allowance) is amended as follows.

(2) Section 55B (tax reduction: entitlement) is amended in accordance with paragraphs (3) to (5).

(3) In subsection (2) (conditions for entitlement to tax reduction)—

(a) for paragraph (a) (individual is spouse or civil partner of maker of election in force under section 55C) substitute—

“(a) the individual is the gaining party (see section 55C(l)(a)) in the case of an election under section 55C which is in force for the tax year,”, and

(b) in paragraph (d), for “individual’s” substitute “relinquishing”.

(4) After subsection (5) insert—

“(5A) In this section “the relinquishing spouse or civil partner”, in relation to an election under section 55C, means the individual mentioned in section 55C(l)(a) by whom, or by whose personal representatives, the election is made.”

(5) In subsection (6) (reduced personal allowance for transferor)—

(a) after “under subsection (1)” insert “by reference to an election under section 55C”, and

(b) for “individual's” substitute “relinquishing”.

(6) Section 55C (elections to reduce personal allowance) is amended in accordance with paragraphs (7) and (8).

(7) In subsection (l)(a) (individual may make election if married or in civil partnership)—

(a) after “the same person” insert “(“the gaining party”)”, and

(b) in sub-paragraph (ii), after “when the election is made” insert “or, where the election is made after the death of one or each of them, when they were last both living”.

(8) After subsection (4) insert—

“(5) The personal representatives of an individual may make any election for the purposes of section 55B that the individual (if living) might make in relation to—

(a) the tax year in which the individual dies, or

(b) an earlier tax year.”

(9) Section 55D (procedure for elections under section 55C) is amended in accordance with paragraphs (10) and (11).

(10) In subsection (3) (elections which are not automatically continued in force for subsequent years), after “is made after the end of the tax year to which it relates” insert “or is made after the death of either of the spouses or civil partners”.

(11) In subsection (4) (election may be withdrawn only by individual who made it), after “by whom the election was made” insert an election made by an individual's personal representatives may not be withdrawn”.

(12) The amendments made by this Resolution—

(a) come into force on 29 November 2017,

(b) have effect in relation to elections made on or after that day, and

(c) so have effect even where a relevant death occurred before that day.

And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

7. Deduction for seafarers’ earnings for duties performed outside UK

Resolved,

That provision may be made in connection with the application of Chapter 6 of Part 5 of the Income Tax (Earnings and Pensions) Act 2003 in relation to employment in the Royal Fleet Auxiliary Service.

8. Exemption for armed forces’ accommodation allowances

Resolved,

That provision may be made exempting, from income tax, amounts paid as accommodation allowances to, or in respect of, members of the armed forces of the Crown.

9. Benefits in kind: cars

Resolved,

That provision (including provision having retrospective effect) may be made amending Chapter 6 of Part 3 of the Income Tax (Earnings and Pensions) Act 2003.

10. Foreign-service relief for benefits on termination of employment

Resolved,

That provision may be made amending Chapter 3 of Part 6 of the Income Tax (Earnings and Pensions) Act 2003 in connection with restricting, in relation to payments and other benefits received in connection with the termination of a person's employment, relief given by that Chapter by reference to service within the definition of “foreign service” given by section 413(2) of that Act.

11. Employment income provided through third parties

Resolved,

That provision may be made in connection with—

(a) the application and operation of Chapter 2 of Part 7 A of the Income Tax (Earnings and Pensions) Act 2003, and

(b) the operation of Part 11 of that Act in connection with Schedule 11 to the Finance (No. 2) Act 2017

12. Disguised remuneration schemes (earnings charged to tax)

Resolved,

That—

(1) In section 554A of the Income Tax (Earnings and Pensions) Act 2003 (employment income provided through third parties: application of Chapter 2 of Part 7A), after subsection (5) insert—

“(5A) Subsections (5B) and (5C) apply where—

(a) a payment to a person other than A, or to A as a trustee, is of earnings from A's employment with B, and

(b) the earnings are, in whole or part, charged to tax under the employment income Parts otherwise than by virtue of this Part,

and for this purpose it does not matter whether all or some only or none of the tax is paid (but see sections 554Z5 and 554Z11B).

(5B) For the purposes of subsection (5C), an arrangement is a “redirected- earnings arrangement” if it (wholly or partly) covers or relates to redirected earnings; and for the purposes of this subsection and subsection (5C) “redirected earnings” means—

(a) the payment mentioned in subsection (5A)(a), or

(b) any sum or other property which (directly or indirectly)—

(i) represents, or

(ii) is derived from,

that payment.

(5C) The circumstances mentioned in subsection (5A)—

(a) do not prevent a redirected-earnings arrangement being within subsection (l)(b), and

(b) do not prevent rewards or recognition or loans being in connection with A's employment with B for the purposes of subsection (l)(c) where there is use of redirected earnings for the provision of the whole, or part, of the rewards or recognition or loans.”

(2) The amendment made by paragraph (1)—

(a) come into force on 29 November 2017,

(b) has effect for the purposes of the operation of Part 7 A of the Income Tax (Earnings and Pensions) Act 2003 in relation to relevant steps taken on or after 22 November 2017, and

(c) so has effect in the case of payments within the new subsection (5A)(a) whenever made (including ones made before 6 April 2011).

And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

13. Trading income provided through third parties

Resolved,

That provision may be made about information for the purposes of the operation of Schedule 12 to the Finance (No. 2) Act 2017.

14. Pensions

Resolved,

That provision (including provision having retrospective effect) may be made about the application of Part 4 of the Finance Act 2004 in relation to—

(a) pension schemes that are Master Trust schemes,

(b) pension schemes established under section 67 of the Pensions Act 2008,

(c) pension schemes that have a dormant sponsoring employer, and

(d) pension schemes treated as registered by virtue of paragraph 1(1) of Schedule 36 to the Finance Act 2004.

15. EIS, SEIS, SI and VCT reliefs

Resolved,

That provision may be made about reliefs under Parts 5, 5A, 5B and 6 of the Income Tax Act 2007, including—

(a) provision having retrospective effect, and

(b) (notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills) provision taking effect in a future year.

16. PARTNERSHIPS

Resolved,

That the following provision relating to partnerships may be made—

(a) provision as to how tax legislation applies where a partner is a bare trustee;

(b) provision for determining the income tax liability of indirect partners;

(c) provision about income tax returns for partnerships.

17. Research and development expenditure credits

Resolved,

That provision may be made amending section 104M(3) of the Corporation Tax Act 2009.

18. INTANGIBLE FIXED ASSETS

Resolved,

That provision may be made amending Part 8 of the Corporation Tax Act 2009.

19. Corporation tax treatment of oil activities: tariff receipts etc

Resolved,

That provision may be made about the meaning of “tariff receipt” for the purposes of Part 8 of the Corporation Tax Act 2010.

20. Hybrid and other mismatches

Resolved,

That provision (including provision having retrospective effect) may be made amending Part 6A of the Taxation (International and Other Provisions) Act 2010.

21. Corporate interest restriction

Resolved,

That provision (including provision having retrospective effect) may be made relating to Part 10 of the Taxation (International and Other Provisions) Act 2010.

22. Corporation tax: Education Authority of Northern Ireland

Resolved,

That provision (including provision having retrospective effect) may be made relieving the Education Authority of Northern Ireland of liability to corporation tax.

23. Chargeable gains (indexation allowance)

Resolved,

That provision may be made restricting indexation allowance for gains chargeable to corporation tax.

24. Chargeable gains (transfer of assets to non-resident company)

Resolved,

That provision may be made amending section 140 of the Taxation of Chargeable Gains Act 1992.

25. Chargeable gains (depreciatory transactions)

Resolved,

That provision may be made amending section 176 of the Taxation of Chargeable Gains Act 1992.

26. First-year tax credits

Resolved,

That (notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills) provision may be made about first-year tax credits paid in connection with relevant first-year expenditure under the Capital Allowances Act 2001.

27. DOUBLE TAXATION RELIEF

Resolved,

That the following provision relating to double taxation relief may be made——

(a) provision in relation to counteraction notices given under Part 2 of the Taxation (International and Other Provisions) Act 2010;

(b) provision restricting credit relief under that Part, or deductions for foreign tax paid, by reference to amounts attributable to an overseas permanent establishment of a company that are used to reduce a foreign tax;

(c) provision (including provision having retrospective effect) to secure that the double taxation arrangements to which effect may be given by Order in Council include arrangements modifying the effect of earlier such arrangements and arrangements conferring functions on public authorities within or outside the United Kingdom.

28. bANK LEVY

Question put,

That provision may be made amending Schedule 19 to the Finance Act 2011, including (notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills) provision taking effect in a future year.