House of Commons Public Bill Committee Proceedings

Session 2012 - 13
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Other Bills before Parliament

Committee of the whole House Proceedings: 17 April 2013
384

Finance (No. 2) Bill, continued

(f)
evidence as to the intent of the parties, irrespective of the outcome of the

arrangements.’.

Application for clearance of transactions

Mr Michael Meacher

Caroline Lucas

Michael Connarty

Mr Frank Field

Kelvin Hopkins

John McDonnell

Not called  NC13

To move the following Clause:—

‘(1)
A person may provide the Commissioners for Her Majesty’s Revenue and

Customs with particulars of a transaction or transactions effected or to be effected

by the person in order to obtain a notification about them under this section.

(2)
If the Commissioners consider that the particulars, or any further information

provided under this subsection, are insufficient for the purposes of this section,

they must notify the person what further information they require for those

purposes within 30 days of receiving the particulars or further information.

(3)
If any such further information is not provided within 30 days from the

notification, or such further time as the Commissioners allow, they need not

proceed further under this section.

(4)
The Commissioners must notify the person whether they are satisfied that the

transaction or transactions, as described in the particulars, were or will be such

that no counteraction notice ought to be served about the transaction or

transactions under the provisions of section [Counteracting the tax advantages]

of this Act.

(5)
The notification must be given within 30 days of receipt of the particulars, or, if

subsection (2) applies, of all further information required but subject to the

conditions of subsection (6) having been met.

(6)
The person making application for a notification under this section shall

specify—

(a)
the amount of tax that they estimate might be due as a result of making

the arrangement, or

(b)
if that arrangement shall be continuing within the two-year period

following its commencement, and

(c)
shall pay a fee in respect of the notification to be supplied under section

(4) prior to that notification being supplied of not less than—

(i)
£1,000, or

(ii)
five per cent of the estimated tax due as a result of making this

arrangement, whichever shall be the greater,


such charge to be subject to value added tax and to be due whether or not

the requested notification can be supplied or not,

(d)
HMRC shall have power to substitute such other sum that it thinks

appropriate for those sums notified under subsections (a) and (b) if it

thinks those estimates unrealistic,

(e)
if HMRC makes use of the powers in subsection (d) it shall notify the

person within 30 days of its intent to do so and provide its estimate of the

Committee of the whole House Proceedings: 17 April 2013
385

Finance (No. 2) Bill, continued

tax that might be due under the arrangement with reasons stated, with the

person having 30 days thereafter to appeal against the same or let their

applications lapse.

(f)
HMRC may publish its notifications issued under this section so long as

the taxpayer’s identity is anonymised.’.

Effect of clearance notification under section [Application for clearance of transactions]

Mr Michael Meacher

Caroline Lucas

Michael Connarty

Mr Frank Field

Kelvin Hopkins

John McDonnell

Not called  NC14

To move the following Clause:—

‘(1)
This section applies if the Commissioners for Her Majesty’s Revenue and

Customs notify a person under section [Application for clearance of

transactions] that they are satisfied that a transaction or transactions, as

described in the particulars provided under that section, were or will be such that

no counteraction notice under the provisions of section [Counteracting tax

advantages] of this Act ought to be served about the transaction or transactions.

(2)
No such notice may then be served on the person in respect of the transaction or

transactions.

(3)
But the notification does not prevent such a notice being served on the person in

respect of transactions including not only the ones to which the notification

relates but also others.

(4)
The notification is void if the particulars and any further information given under

section [Application for clearance of transactions] about the transaction or

transactions do not fully and accurately disclose all facts and considerations

which are material for the purposes of that section.’.

Power to obtain information

Mr Michael Meacher

Caroline Lucas

Michael Connarty

Mr Frank Field

Kelvin Hopkins

John McDonnell

Not called  NC15

To move the following Clause:—

‘(1)
This section applies if it appears to an officer of Her Majesty’s Revenue and

Customs that a person may be a person to whom section [Counteracting tax

advantages] applies in respect of one or more transactions.

Committee of the whole House Proceedings: 17 April 2013
386

Finance (No. 2) Bill, continued

(2)
The officer may serve a notice on the person requiring the person to give the

officer information in the person’s possession about the transaction or, if there are

two or more, about any of them.

(3)
That information must be information about matters that are relevant to the

question whether a counteraction notice should be served on the person.

(4)
Those matters must be specified in the notice under subsection (2).

(5)
That notice must require the information to be given within such period as is

specified in it.

(6)
That period must be at least 30 days.’.

Interpretation

Mr Michael Meacher

Caroline Lucas

Michael Connarty

Mr Frank Field

Kelvin Hopkins

John McDonnell

Not called  NC16

To move the following Clause:—

‘In this Part of this Act—

“arrangements” includes any agreement, understanding, scheme,

transaction or series of transactions (whether or not legally enforceable),

“connected” is defined by section 993 of the Income Tax Act 2007,

“the general anti-tax avoidance principle” has the meaning given by section

[General anti tax-avoidance principle],

“HMRC” means Her Majesty’s Revenue and Customs,

“notification” has the meaning given by section [Application for clearance

of transactions] (1),

“tax advantage” has the meaning given by section [Meaning of “tax

advantage”],

“tax arrangements” has the meaning given by section [Meaning of “tax

arrangements”] (1),

“tax avoidance” has the meaning given by section [Meaning of “tax

avoidance”], and

“taxes” has the meaning given to it by section [General anti-tax-avoidance

principle] (3).’.

Nigel Mills

Not called  11

Clause  203,  page  120,  line  1,  after ‘taxes, insert ‘provided the de minimis test in

subsection (4) is satisfied.’.

Committee of the whole House Proceedings: 17 April 2013
387

Finance (No. 2) Bill, continued

Ed Balls

Chris Leslie

Catherine McKinnell

Cathy Jamieson

John McDonnell

Not called  3

Clause  203,  page  120,  line  9,  at end add—

‘(4)
Her Majesty’s Revenue and Customs shall review the possibility of bringing

forward measures to work in conjunction with other G8 countries to require

multi-national companies to publish a single easily comparable figure for the

amount of corporation tax they pay in the UK, and within six months of the

passage of this Act, place a copy of the review in the House of Commons Library.

(5)
The Chancellor of the Exchequer shall review the effects of incorporating

measures into the general anti-abuse rule to require multi-national companies to

publish a single easily comparable figure for the amount of corporation tax they

pay in the UK on Treasury tax receipts within six months of the passage of this

Act and consult with G8 countries on their effectiveness, and place a copy of the

review in the House of Commons Library.’.

Ed Balls

Cathy Jamieson

Chris Leslie

Catherine McKinnell

John McDonnell

Negatived on division  6

Clause  203,  page  120,  line  9,  at end add—

‘(4)
The Chancellor shall review the possibility of bringing forward a requirement for

UK companies to report their use of tax schemes which have an impact on

developing countries, including a review of the possibility of bringing forward

proposals to require that when such schemes are identified under those rules, Her

Majesty’s Government shall take steps to notify developing countries’ tax

authorities and assist in the recovery of that tax. A copy of the report shall be

placed in the House of Commons Library within six months of Royal Assent.’.

Ed Balls

Cathy Jamieson

Chris Leslie

Catherine McKinnell

John McDonnell

Not called  7

Clause  203,  page  120,  line  9,  at end add—

‘(4)
The Chancellor shall make an assessment of the impact of changes to Controlled

Foreign Company Rules in the Finance Act 2012 and as a result of this Part of this

Act on the overall tax take of developing countries. A copy of the report shall be

placed in the House of Commons Library within six months of Royal Assent.’.

Ed Balls

Cathy Jamieson

Chris Leslie

Catherine McKinnell

John McDonnell

Negatived on division  8

Clause  203,  page  120,  line  9,  at end add—

‘(4)
The Chancellor shall provide a report to Parliament within two years of the

passing of this Act, as part of a wider post-implementation review, into the scope

Committee of the whole House Proceedings: 17 April 2013
388

Finance (No. 2) Bill, continued

of GAAR, the application of the double reasonableness test and its deterrent

effect.’.

Nigel Mills

Not called  12

Clause  203,  page  120,  line  9,  at end add—

‘(4)
The amount of the tax advantage arising from the tax arrangement must be equal

to or exceed the following amount for the relevant tax:

(a)
for income tax the amount is £100,000,

(b)
for corporation tax, including any amount chargeable as if it were

corporation tax or treated as if it were corporation tax, the amount is

£250,000,

(c)
for capital gains tax the amount is £100,000,

(d)
for petroleum revenue tax the amount is £250,000,

(e)
for inheritance tax the amount is £100,000

(f)
for stamp duty land tax the amount is £40,000,

(g)
for the annual tax on enveloped dwelling the amount is £40,000.

(5)
For the purposes of subsection (4) the amount of the tax advantage shall be the

greatest of:

(a)
the total tax advantage for all tax years in which it is reasonable to assume

that the tax arrangement was anticipated to be effective at the time the

arrangements were entered into;

(b)
the total tax advantage for all tax years that would have arisen from the

tax arrangement other than for the provisions of this Part;

(c)
the total tax advantage arising from all tax arrangements of the taxpayer

that were anticipated to be effective in the relevant tax year.

(6)
For the purposes of subsection (5) the amount of the tax advantage shall include

any tax advantage obtained by the taxpayer or a related party of the taxpayer.’.

Clauses 203 to 212 Agreed to.

Schedule 41 Agreed to.

Progress reported.



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