Oral Answers to Questions

Yuan Yang Excerpts

Tuesday 28th April 2026 Commons Chamber

[Rachel Reeves]

What the right hon. Gentleman is basically admitting is that he would have gone ahead with the increases in fuel duty and business rates, and that he would take that money out of our national health service. We made those changes on the mandate that we got at the election, and at the same time we are reducing the budget deficit so that, for the first time in six years, it is now below 5% of GDP. As a result, the Bank of England has cut interest rates six times, helping all our constituents with their mortgages. This is very different from the hikes in mortgages that we saw under the previous Tory Government.

[Yuan Yang (Earley and Woodley) (Lab)]

T2. This weekend, while door-knocking in Woodley, I spoke to a young father of three who, despite working multiple skilled jobs, feared being made homeless because of high and rising costs of rent. Will the Chancellor examine the case for a fixed-term rent freeze in the private rented sector to protect renters like my constituent from rising costs following the invasion of Iran, and to bring inflation down in the wider economy?

[Rachel Reeves]

As my hon. Friend knows from sitting on the Treasury Committee, this Government have already taken action to reduce the cost of living and to bear down on inflation with the changes around energy prices, fuel duty, prescription charges and rail fares. I will do everything in my power and use every lever we have to bear down on the cost of living, including for people in the private rented sector. That is why we have already introduced the Renters’ Rights Act 2025. People who have mortgages have seen cuts in their mortgage rates since we came into office, and we will also do everything we can to help people in the private rented sector too, because we must ensure that this conflict in the middle east does not result in our constituents being poorer.

Spring Forecast

Yuan Yang Excerpts

Tuesday 3rd March 2026 Commons Chamber

[Yuan Yang (Earley and Woodley) (Lab)]

I thank the Chancellor for her strong statement and, in particular, for her words on deepening our alliances with our European partners. This is crucial for bringing down the cost of food and for healing the economic self-harm done by the Conservatives. The Bank of England has said that her cuts to energy bills will help bring inflation down to around its target from next month. Will she commit to going further and continue to shield our constituents from global price shocks?

[Rachel Reeves]

The Bank of England forecast that the actions that I took in the Budget last year would reduce inflation by around 0.4 percentage points, and that inflation will be back close to target from April. That reflects not just taking £150 off energy bills, but freezing prescription charges and rail fares. The events unfolding in Iran and the middle east have resulted, over the last couple of days, in gas prices going up by more than 60% and oil prices by more than 10%. That shows why our plan to take money off energy bills and ensure that our public finances are in a stronger place mean that we are in a better place than we would have been 18 months ago, after the mess left by the Conservatives.

OBR: Resignation of Chair

Yuan Yang Excerpts

Wednesday 3rd December 2025 Commons Chamber

[James Murray]

As I have made clear, the Treasury will be focused in the coming months on ensuring that we have stronger information security in the spring forecast and all future forecasts. It is worth my adding that the OBR has in recent years had significantly increased funding: since 2021-22, its budget has increased by 45%. As an independent organisation, it has full discretion in how it uses its budget.

[Yuan Yang (Earley and Woodley) (Lab)]

I join the Chair of the Treasury Committee in thanking Richard Hughes for his service, and commend him for taking responsibility for the security leak that happened on his watch.

In testimony given to the Treasury Committee yesterday, the OBR described the “£21 billion average absolute revision” to their pre-measures forecasts as meaning, in effect, that between every six-month forecast, £21 billion on average is wiped off or added to the headroom. That leads me to ask: how can we ensure long termism in the UK’s fiscal institutions, despite this overall focus on headroom?

[James Murray]

The Chancellor set out at the Budget how important it is to increase our headroom. We have increased it to £21.7 billion, which is critical to reducing the cost of borrowing and protecting us against future shocks. The Chancellor also announced that the OBR’s spring forecast will not include an assessment of the Government’s performance against the fiscal rules, and the Government will not respond to it with fiscal policy; but the OBR will produce a forecast in spring, as expected.

Property Taxes

Yuan Yang Excerpts

Wednesday 3rd September 2025 Commons Chamber

[Sir Mel Stride]

That is right. We live in a highly mobile world; it is easy for people with substantial wealth or money to invest to go anywhere in the world. We have to remain competitive, and this Government are making us less competitive. My right hon. Friend refers to unemployment, but just look at the record—should we have expected any more from this Government? No, not really. Every single Labour Government in history have left unemployment higher when they left office than it was at the time they came into office. What have we seen on unemployment since this Government have been in office? It has increased every single month since they have been in power.

[Yuan Yang (Earley and Woodley) (Lab)]

The right hon. Gentleman has spent the past five minutes circling around figures gathered by a consultancy that aids the super-wealthy to migrate from this country. Where is the Conservative party getting its economic ideas from? It speaks volumes that he has spent so much time up to this point speaking for the 15,000 high net worth individuals served by that consultancy; and his previous point was about inheritance tax, which is paid by only 4% of all estates in the UK. If he has any ideas, what will the Conservative party do to grow the economy for the benefit of all people in this country?

[Sir Mel Stride]

The hon. Lady asks where we are getting our ideas from; where we are not getting them from is from academics and researchers who believe in taxing wealth and who now sit there on the Treasury Bench, or in other places where they advise No. 10. They talk on a regular basis about taxing property, wealth, shares and assets of any description that they can think of, but that is the road to ruin. She asked where we get our ideas from, and I will tell her. I set up my own business in the 1980s, from absolutely nothing. I grew it from scratch, and then I took it over to America and grew a business there. I have lived, breathed and eaten business most of my life. I also go up and down the country to speak to other such businesses. They are the people who understand what needs to be done on the tax front and who have to live with the red tape that her party is bringing in to tie them down. They are the people whom this party is listening to.

Government Performance against Fiscal Rules

Yuan Yang Excerpts

Monday 7th July 2025 Commons Chamber

[Darren Jones]

As a consequence of the Chancellor’s decisions, we gave Scotland the largest real-terms spending increase since devolution began, and the only radical change that we are now looking for is the Scottish National party to be kicked out of Holyrood next May.

[Yuan Yang (Earley and Woodley) (Lab)]

As my hon. Friend the Member for Loughborough (Dr Sandher) mentioned, there were seven different sets of fiscal rules under the previous Government. The shadow Chancellor, the right hon. Member for Central Devon (Sir Mel Stride), has announced that he has reflected on the mistakes made by the Truss Government and I am sure that international investors watching what is happening in the Commons would like to see sensible debate from all parties in the Chamber on the most critical challenge facing our times. Will the Chief Secretary therefore set out the important ways in which capital investment unlocked under these fiscal rules are allowing for economic growth and development?

Spending Review 2025

Yuan Yang Excerpts

Wednesday 11th June 2025 Commons Chamber

[Rachel Reeves]

Last week, we set out additional money for the Mayor of the West of England, and today we have announced a fourfold increase in local transport funding, which will be available for communities across the country. The hon. Member says that he wants to grow the economy—it is disappointing that the Liberal Democrats voted against the Planning and Infrastructure Bill yesterday, which will do exactly that.

[Yuan Yang (Earley and Woodley) (Lab)]

I strongly congratulate the Chancellor on the impact she has already had by reforming the way the Treasury works, in particular to unlock the capital investment that we need for the future of our economy. I also commend her for her commitment to future generations through her funding for schools and the extension of free school meals. Will she continue to work with the Treasury to change the way it appraises the benefits of human capital investment to ensure there is sufficient funding, particularly for early intervention in special educational needs and disabilities in local authorities like mine in Reading and Wokingham?

[Rachel Reeves]

I thank my hon. Friend for welcoming the reforms we have introduced at the Treasury—the reform to the fiscal rules to unlock money for investment, the reform of financial transactions to enable more money to be spent through public finance institutions, and particularly the reform of the Green Book. She is absolutely right to mention the importance of human capital, which is why we have announced in the spending review significant investment in skills and in the early years to ensure that children are ready for school.

Spring Statement

Yuan Yang Excerpts

Wednesday 26th March 2025 Commons Chamber

[Rachel Reeves]

The key point in what the right hon. Gentleman says is that cumulative growth is lower from 2023 to the end of the forecast. Of course, this Government did not come into power in 2023; we came into power in July 2024. The OBR numbers show that the economy is bigger because of the changes we have made—it is just a difference in the dates. I look forward to coming to the Treasury Committee next week, and I am sure I will take more questions from the right hon. Gentleman then.

[Yuan Yang (Earley and Woodley) (Lab)]

The Chancellor has rightly championed economic stability, in stark contrast to the previous Government—indeed, in stark contrast to the previous five Chancellors. Yet, as she has said, the world is becoming more unstable, and that global instability feeds through to rapid changes in official projections, which can constrain our room for action. Can the Chancellor reaffirm to us that she will keep her focus on fiscal stability, despite these challenges, to meet the long-term missions of this Government: to defend our country, improve living standards and protect the most vulnerable in our society?

[Rachel Reeves]

My hon. Friend is absolutely right that her constituents—all our constituents—depend on economic stability. It ensures that they know how much they will pay on their rent and mortgages; it ensures that they are not caught out, when they go to the shops, by prices constantly rising. That is why, as a Government, we have said that the No. 1 thing we need to achieve in order to grow our economy is economic stability, which is why I am so pleased that the Bank of England has been able to cut interest rates three times since the general election and the OBR has forecast that inflation will fall rapidly to 2.1% next year, and then 2% in the years after that.

Finance Bill (Fourth sitting)

Yuan Yang Excerpts

Committee stage
Thursday 30th January 2025 Public Bill Committees

[James Wild]

I beg to move, That the clause be read a Second time.

To support growth, innovation and investment, we require a competitive tax environment for business. New clause 10 would require the Chancellor, within six months of the Bill being passed, to conduct a review of business and lay before the House a report setting out recommendations arising from the review, including recommendations on how to use business tax to encourage and increase the investment of profits and revenue, and on how to ensure that businesses have certainty about the taxes to which they are subject.

A common theme throughout the Committee has been the impact of the measures in the first Labour Budget for 14 years. Sadly, we know that that Budget and this Finance Bill introduce tax increases of around £40 billion a year—it is the biggest tax-raising Budget in modern history. It is businesses that are bearing the brunt, including the £25 billion a year through the jobs tax that the Government repeatedly promised during the election not to introduce.

The Government said that their priority is growth. We heard more about their plans yesterday, but we did not hear much about how their plans would deliver more growth in this Parliament, rather than in the long term. While that is welcome, I think people are also interested in the here and now. Having inherited the fastest-growing economy in the G7, the OBR then downgraded the growth rate by 0.7% in its forecast, as a result of the measures in the Budget. We have seen borrowing costs rise to the highest level for 27 years, inflation is above target and business confidence is plummeting. That latter point is what lies behind the new clause.

[Yuan Yang (Earley and Woodley) (Lab)]

Although I am very much in support of reviews, and the OBR is the right body to conduct ongoing reviews of the impact of taxation on growth, does the hon. Gentleman want to set out any direction in which the Opposition might want to take business taxes? If there is a certain direction, where will the costs and savings come from?

[James Wild]

Would that we had the happy chance to be sitting in the Treasury making the policy decisions. It is the Chancellor who will bring forward another fiscal event, and who may have to take some action to deal with the impact of her Budget. This is about what the Government will do and the review that they conduct and bring forward.

Business confidence is essential for investment, but it has been damaged by this Government, when they first came in, talking down the economy. We now hear a much more positive tone talking about our strengths, and the strong fundamentals of our economy, which were all points that the Opposition made throughout our period in office. We encouraged the Government to do the same when they came in, but they wanted to talk about a fantasy black hole and the worst economic inheritance, which has done a lot of damage to our economy.

The latest Confederation of British Industry growth indicator shows that private sector firms expect a significant fall in activity over the next three months. The latest purchasing managers’ index flash shows that one in four businesses have cut jobs due to employment costs. The Office for National Statistics showed that retail sales in December fell by 43%. This is a worrying state of affairs and any Members who speak to businesses will have heard the deep concerns over the hiking costs of employing people, the cut in business rate support for retail, leisure and hospitality businesses, and other measures.

The Budget put up taxes on entrepreneurs and wealth creators, and it is driving people who create wealth away from our country. The energy profits levy puts at risk 35,000 jobs in Scotland and the North sea. The family business tax, which was launched without any warning, has had a highly damaging impact on family farms and other family firms. That is why a review of business taxation is so necessary, with the objective of not only encouraging an increase in investment but providing certainty for firms. The Minister has spoken repeatedly about certainty, so I hope he will feel able to support the new clause.

Finance Bill (First sitting)

Yuan Yang Excerpts

Committee stage
Tuesday 28th January 2025 Public Bill Committees

[Yuan Yang (Earley and Woodley) (Lab)]

Might it not be more appropriate to view the measure in the context of the housing crisis that our country is currently in, and the record proportion of under-35s living at home with their parents rather than being able to live in their own accommodation? Does the hon. Member agree that there should be no tax incentives for accommodation to be turned into short-term furnished lets as opposed to long-term living places?

[The Chair]

Order. Can we keep the discussion within the context of the clause and the schedule?

--- Later in debate ---

[Gareth Davies]

It is clear that the Government have launched an attack on farmers across rural communities in our country. The family farm tax is a disgrace. Farmers have protested and tried to make their voices heard, but still cannot get a meeting with the Chancellor of the Exchequer. I urge the Minister, who is very open to meetings, to have a word with his Chancellor, who is consistently in hiding and running out of the country when things get difficult as a result of her decisions.

Perhaps it is true that the Environment Secretary wants farmers to pay even more tax. Why else would he say to farmers in Oxford, “Convert your barns into holiday lets,” while over the road the Treasury is taking away these reliefs and making it more tax inefficient for them to do so? This is yet another area where the Labour Government seem intent on cancelling out genuinely pro-growth deregulation, which we welcome, with anti-growth taxation.

[Yuan Yang]

Will the hon. Gentleman give way?

[Gareth Davies]

Does the Labour Member who is about to intervene on me support holiday lets?

[Yuan Yang]

I am glad that we have returned to this topic, because I was about to ask the hon. Gentleman whether he might clarify the relationship between his remarks and the commercial letting of furnished holiday accommodation—[Interruption.] But of course I support the equalisation of tax measures provided for by the clause.

[Gareth Davies]

I am sorry, but there was a very loud cough when the hon. Lady intervened. Would she repeat her intervention?

[Yuan Yang]

I was simply hoping to get us back on to the topic of the commercial letting of furnished holiday accommodation.

[Gareth Davies]

Oh, so it was more of a heckle than an intervention, but that is very welcome too; it makes it a bit more lively for the very large audience we have today.

I would be grateful if the Minister could set out the policy of this Labour Government. Do they support holiday lets? The Environment Secretary clearly supports them and wants farmers to diversify into them, while at the same time the Treasury—yes, we announced the policy in March—clearly wants to tighten up the rules on taxation. It would be great to hear the Minister clarify that, but it seems that the answer depends on which Minister one talks to on any given day. Let us see what the answer is in this Committee, from this Minister, today.

Clause 25 also touches on a long-standing issue of whether letting constitutes a trading activity or a property business. The FHL regime created a clear distinction by deeming a letting business to be considered a trade for certain purposes. Some organisations, such as the excellent Chartered Institute of Taxation, are concerned that removing the regime removes this distinction and could open up a whole can of worms, leading to costly disputes for both the taxpayer and HMRC. Can the Minister clarify what defines a letting as a trading activity in the absence of the FHL regime, or at least commit to the publication of updated, clearer guidance for the industry on that subject? The Chartered Institute of Taxation is also seeking confirmation on the following points—

Finance Bill (Second sitting)

Yuan Yang Excerpts

Committee stage
Tuesday 28th January 2025 Public Bill Committees

[Gareth Davies]

Currently, a person who is UK resident but not UK domiciled pays tax on any UK income and gains but can choose for their non-UK income and gains to be taxed on a remittance basis. Part 2 of the Bill provides for the abolition of non-domiciled status from April 2025, as the Minister points out, and for its replacement with a new regime for the taxation of foreign incomes and gains on the basis of UK residence. It therefore terminates the current tax regime for those who are resident but not domiciled in the UK, while creating a temporary repatriation facility for historical foreign income and gains to be brought into the UK over the next three years. Those changes will also be applied to trusts under the Bill and inheritance tax will also be brought into the new, residence-based system.

Although the shape of the overall package is much the same as the one the Conservatives announced in the spring Budget 2024, there are a few notable differences on the detail. Before I move through the chapters—we will spend a bit of time on that, starting with chapter 1—I will first provide some context by noting that, net of the reforms we announced in March, Labour’s adjustments to the new regime are forecast to raise £12.7 billion over the next five years. This means the measure we are considering is the second biggest revenue-raising new policy in this entire Budget. Labour’s adjustments to the temporary repatriation facility alone account for £10.6 billion.

These are significant sums, but also highly uncertain, according to the OBR. There is significant uncertainty in particular around the behavioural responses and the size of the tax base, according to the OBR’s assessment. The OBR also says it is unclear to what extent inflows to the temporary repatriation facility are additional over the long term rather than bringing forward disposals which would otherwise have attracted full rates of taxation.

When the second biggest revenue-raising new policy in a Budget is so uncertain, according to the OBR, bond market jitters come as no surprise. The emphasis Labour has placed on this policy, which makes up a massive chunk of the Bill, is compounding its conundrum ahead of the OBR’s March forecast. It exacerbates fiscal instability by adding to the risk that revenues will not be as high as anticipated. This brings us back to the same old questions we have been asking, including in the Chamber today: which taxes will Labour have to raise if there is a shortfall, or which services will they have to cut? The Minister will say that we need to wait for the OBR’s revised forecasts, but will those include an update on these highly uncertain figures?

Turning specifically to chapter 1, clauses 37 and 39 introduce the new four-year 100% relief on eligible foreign income and gains for those arriving in the UK who have not been UK tax residents in the 10 tax years immediately prior to their arrival. I acknowledge that that mostly mirrors the proposals we put forward in the March Budget 2024 but would be grateful if the Minister could none the less address the following points.

[Yuan Yang (Earley and Woodley) (Lab)]

The hon. Gentleman raises the question of estimates around the level of revenue that would be generated by this important measure. Is he familiar with the work of Andy Summers and Arun Advani at LSE and the University of Warwick? Three years ago, in 2022, they modelled the effect of the 2017 tax reforms on non-doms and used that as a basis for statistical estimates for the proposal before us. While economics is a science that does to the best it can with the data available, I think there are some quite substantial measures available on the table for this proposal.

[Gareth Davies]

I am afraid I have not taken the time to read the academic reports, but I greatly value and emphasise the work of the OBR, which the Conservatives established in government. The new Government have taken it forward and are already seeking to bolster its impact on the Treasury’s work. If the hon. Lady will forgive me, it is the OBR’s work that I look at, and that work says that this budgetary measure is highly uncertain. As I was pointing out, that leaves questions for markets and for the Labour parliamentary party when it comes to which taxation will have to go up and what spending will be cut if that figure is not met. I will leave that to the Minister to address.