Taxation (Post-transition Period) Bill

Debate between William Cash and Anneliese Dodds

2nd reading & 2nd reading: House of Commons
Wednesday 9th December 2020 Commons Chamber

[Anneliese Dodds]

Of course we need application and a determination to conclude a deal on both sides; that surely is obvious. But the fact remains, as I will go on to describe, that it was the UK Government that, rather than tabling this Bill many weeks ago, which they could have done, decided to effectively retain provisions that threaten to break international law. That is on the Government’s head, and it is something that the Government must surely be responsible for.

The irresponsible approach that we have seen recently speaks to a wider pattern over the last 12 months of recklessness with public finances, broken promises to the British people and short-term thinking that is doing long-term damage to our country. The Prime Minister promised the British people that he would get Brexit done. He said he had an “oven-ready” agreement. Whatever he has got cooking ahead of his dinner with von der Leyen tonight, my message to him is to get on and deliver what was promised.

[Sir William Cash]

I would just like to point out to the hon. Lady that Labour Governments, not to mention Conservative Governments or the coalition Government after 2010—there is a host of examples by a number of Governments—have passed treaty overrides, on exactly the same principles relating to Finance Bills, in the past. If she wants to construe that as breaking international law, she can, but the reality is that it is consistent with article 46 of the Vienna convention.

[Anneliese Dodds]

I am pleased that the hon. Gentleman mentions that situation, because it has been referred to by those who favoured the Government’s approach previously. However, I gently state to him that if he is referring in particular to provisions against tax avoidance—the example of a general anti-avoidance rule—then, sadly, I believe he is mistaken. In that case, that commitment and the ability to apply such rules was actually a fundamental principle agreed to by this country as part of a multilateral agreement that it concluded with the OECD, so I fear that that example is not as telling as he may wish it to be.

With just three weeks to go until the end of the transition period, the Government published late yesterday afternoon the 116-page Bill that we are discussing now, setting out detailed new rules for tax and customs duties. Members of this House have been given less than 24 hours to scrutinise a major piece of post-Brexit legislation that will impact businesses and individuals across the country, especially in Northern Ireland. Many of the clauses in the Bill, particularly those covering customs and excise duties, require the Treasury to make regulations that will set out the actual detail of its proposals at a later date, so even with the publication of the Bill, businesses and individuals still do not have the information they need to prepare for the end of the transition period.

Earlier today, the Chancellor of the Duchy of Lancaster said there would be “further clarity” forthcoming on these matters, but again without saying when. In fact, the Minister talked a few moments ago about those details coming in due course. His letter to Members spoke about the fact that there would be information on this later; “in the coming days” was the formulation at that time. How can he really expect businesses to plan on that basis—on the never-never up to 1 January?

This last-minute approach was not necessary. It is no use pointing to the complexity of the ongoing negotiations. We know that this Bill could have been published a long time ago because the Government have been floating a Finance Bill for months, so why yet another last- minute scramble? My right hon. Friend the Member for Wolverhampton South East (Mr McFadden) set it out very clearly: because the Conservatives had a not-so-cunning plan to use this Bill as negotiations reached a critical point by threatening to override the withdrawal agreement. At a time when we are seeking to negotiate new trading relationships across the international community, and when the Government are trying to project an image of global Britain to the world, this tactic certainly sent a clear message, albeit not the message the Government intended.

It is welcome that the Government finally saw sense yesterday, although we have already seen damage being done. Both in relation to the provisions in the Bill and more generally, the time is running out to ready our country for the challenges ahead. The Public Accounts Committee was clear last week that:

“Government is not doing enough to ensure businesses and citizens will be ready for the end of the transition period”.

It expressed concern at reports from industry bodies that the Government had not provided the key information needed for businesses to prepare. Indeed, the Committee indicated that more than a third of small and medium-sized enterprises still believed that the transition period would be extended.

The Cabinet Office has admitted that it is well behind in recruiting the customs agents desperately needed for 1 January, despite more than £80 million having been spent so far. Yet again, earlier today, the Chancellor of the Duchy of Lancaster refused to specify exactly how many additional customs agents had been recruited. Overall, £4.4 billion has been spent by the Government on preparations for Brexit and the end of the transition period, yet we are still not ready.