Asked by: Stephen Gethins (Scottish National Party - Arbroath and Broughty Ferry)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, with reference to Section 2.28 of the OBR’s Economic and Fiscal Outlook, what assessment she has made of the potential impact of a 15% decrease in the UK economy on public finances.
Answered by Darren Jones - Chief Secretary to the Treasury
The growth mission is the central mission of the government. Through the growth mission, the government is restoring economic stability, increasing investment, and reforming the economy to drive up prosperity and living standards across the UK.
The government sets its fiscal policy on the basis of the official OBR forecast, which is a central case. The OBR confirms the government is on track to meet its fiscal rules.
To clarify, section 2.28 of the OBR's latest Economic and Fiscal Outlook refers to a pre-existing judgement that has been captured in their forecasts for many years.
Asked by: Stephen Gethins (Scottish National Party - Arbroath and Broughty Ferry)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment she has made of the potential impact of leaving the European (a) Customs Union and (b) Single Market on growth.
Answered by Tulip Siddiq - Economic Secretary (HM Treasury)
The UK economy has experienced significant disruption in recent years due to a range of factors including Covid-19, supply chain disruption and the invasion of Ukraine by Russia. It remains challenging to separate out the effects of leaving the Customs Union and Single Market from wider global trends affecting the UK economy.
It is for the Office for Budget Responsibility (OBR) to provide independent and authoritative analysis and forecasting for the UK public finances. The OBR has estimated that productivity will be 4% lower in the long run than it would have been had the UK not withdrawn from the EU, and that imports and exports will eventually both be 15 per cent lower than had we stayed in the EU. The OBR estimated in March 2024 that 40% of this impact has already materialised.
Asked by: Stephen Gethins (Scottish National Party - Arbroath and Broughty Ferry)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment her Department has made of the impact of the UK's exit from the EU on public finances.
Answered by Tulip Siddiq - Economic Secretary (HM Treasury)
The Government has no overall estimate of the impact of the UK’s exit from the EU on public finances.
As part of the Withdrawal Agreement with the EU, the UK agreed the Financial Settlement, which is a methodology for settling pre-existing UK financial obligations to the EU. The European Union Finances Statement 2023 (available in the library of the House and on Gov.uk) sets out HMT Treasury’s estimates of the size of these obligations. As at December 2023, the UK is estimated to have paid £23.8bn (€27.4bn) in net liabilities to date as part of the EU financial settlement. Estimated UK outstanding net liabilities as of December 2023 were £6.4bn (€7.4bn).
Asked by: Stephen Gethins (Scottish National Party - Arbroath and Broughty Ferry)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what steps his Department is taking to (a) tackle Money Laundering and (b) promote ethical financing in the Crown Dependencies and the UK’s Overseas Territories.
Answered by John Glen - Shadow Paymaster General
The UK’s Crown Dependencies and Overseas Territories are self-governing jurisdictions with their own democratically-elected governments responsible for most areas of their domestic policy, including fiscal matters. They co-operate with the UK in matters relating to taxation, fighting financial crime and countering terrorist finance.
The Crown Dependencies and Overseas Territories have committed to meeting the global standards for anti-money laundering and counter terrorist financing set by the Financial Action Task Force (FATF). They are evaluated by the FATF in their own rights as self-governing jurisdictions.
The Crown Dependencies and Overseas Territories with financial centres share beneficial ownership information with the UK’s law enforcement agencies and are committed to global tax transparency standards such as the OECD Common Reporting Standard, an agreement to automatically exchange financial account information with other jurisdictions.
Asked by: Stephen Gethins (Scottish National Party - Arbroath and Broughty Ferry)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment his Department has made of the potential risk of the misuse of financial investment treaties to launder money in the Crown Dependencies and the UK’s Overseas Territories.
Answered by John Glen - Shadow Paymaster General
The government assesses a range of money laundering and terrorist financing risks to the UK through the joint Treasury and Home Office National Risk Assessment (NRA). This includes considering risks in other jurisdictions that may facilitate money laundering or terrorist financing activity in the UK. The last NRA was published in October 2017 and can be found here: https://www.gov.uk/government/publications/national-risk-assessment-of-money-laundering-and-terrorist-financing-2017. The next NRA will be published by July 2020.
Asked by: Stephen Gethins (Scottish National Party - Arbroath and Broughty Ferry)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment he has made of the potential merits of UK compliance with (a) current and (b) future EU anti-money laundering policies after the UK leaves the EU.
Answered by John Glen - Shadow Paymaster General
The UK is a founding member and strong support of the Financial Action Taskforce (FATF), which sets global anti-money laundering and counter-terrorist financing (AML/CTF) standards. These standards are generally incorporated into UK law through the transposition of EU directives.
The Fourth EU Anti-Money Laundering Directive was transposed into UK law by the Money Laundering Regulations 2017. This directive updated EU anti-money laundering policy to reflect the 2012 update to the FATF standards.
The Fifth EU Anti-Money Laundering Directive (5MLD) was finalised in 2018 to further strengthen transparency and counter-terrorist legislation. The UK played a significant role in the negotiation of 5MLD and shares the objectives which it seeks to achieve on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing. HM Treasury is currently running a consultation process inviting views and evidence on the steps the government proposes to take to meet the UK’s expected obligation to implement 5MLD by January 2020, and expects to publish an impact assessment in due course.
The Sanctions and Anti-Money Laundering Act gives the UK the powers to update its future anti-money laundering regime post EU-exit. As a leading member of the FATF, the UK will continue updating anti-money laundering policies according to international standards, ensuring the UK’s AML/CTF regime is kept up to date, effective and proportionate.
The Political Declaration that has been agreed with the EU contains a statement of mutual intent that the future relationship should cover money laundering and terrorist-financing.
Asked by: Stephen Gethins (Scottish National Party - Arbroath and Broughty Ferry)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, what assessment his Department has made of the effect on tax receipts of consumers choosing to buy items online from non-UK domiciled firms.
Answered by Mel Stride - Shadow Chancellor of the Exchequer
HMRC has estimated the amount of VAT foregone by sellers on online marketplaces was between £1bn and £1.5bn in 2016-17, and is attributed to both UK-based and overseas sellers.
Asked by: Stephen Gethins (Scottish National Party - Arbroath and Broughty Ferry)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, what discussions he has had with Cabinet colleagues on HMRC using internet service provider data to calculate and process sales tax on goods bought by consumers.
Answered by Mel Stride - Shadow Chancellor of the Exchequer
In line with the practice of successive administrations, details of ministerial discussions are not normally disclosed.
Asked by: Stephen Gethins (Scottish National Party - Arbroath and Broughty Ferry)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, what assessment his Department has made of the potential merits of HMRC using internet service provider data to calculate and process (a) VAT and (b) corporation tax.
Answered by Mel Stride - Shadow Chancellor of the Exchequer
HMRC has a comprehensive set of data-gathering powers which it uses for a range of compliance and operational purposes. They gather data from a range of intermediaries and third parties, operating both online and in the traditional economy. HMRC keeps both its powers and its use of them under review.
Asked by: Stephen Gethins (Scottish National Party - Arbroath and Broughty Ferry)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, what representations he has received from civil society organisations on HMRC using internet service provider data to calculate and process sales tax on goods bought by consumers.
Answered by Mel Stride - Shadow Chancellor of the Exchequer
The Government receives a large number of representations from a wide range of organisations as part of the policy development process.