Wales Bill (HC Bill 186)

A

BILL

TO

Make provision about elections to and membership of the National Assembly
for Wales; to make provision about the Welsh Assembly Government; to make
provision about the setting by the Assembly of a rate of income tax to be paid
by Welsh taxpayers and about the devolution of taxation powers to the
Assembly; to make related amendments to Part 4A of the Scotland Act 1998; to
make provision about borrowing by the Welsh Ministers; to make
miscellaneous amendments in the law relating to Wales; and for connected
purposes.

Be it enacted by the Queen’s most Excellent Majesty, by and with the advice and
consent of the Lords Spiritual and Temporal, and Commons, in this present
Parliament assembled, and by the authority of the same, as follows:—

Part 1 The Assembly and Welsh Government

National Assembly for Wales

1 Frequency of Assembly ordinary general elections

(1) 5In section 3(1) of GOWA 2006 (date of Assembly ordinary general elections),
for “fourth” substitute “fifth”.

(2) Accordingly, in the Fixed-term Parliaments Act 2011 omit section 5 (date of
next Assembly ordinary general election).

2 Removal of restriction on standing for election for both constituency and
10electoral region

(1) GOWA 2006 is amended as follows.

(2) In section 7 (candidates at general elections)—

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(a) in subsection (5), for paragraph (c) (and the “or” before it) substitute—

(c) who is a candidate to be the Assembly constituency
member for an Assembly constituency which is not
included in the Assembly electoral region, or

(d) 5who is a candidate to be the Assembly constituency
member for an Assembly constituency included in the
Assembly electoral region but is not a candidate of the
party.;

(b) in subsection (6), for paragraph (c) (and the “or” before it) substitute—

(c) 10a candidate to be the Assembly constituency member for
an Assembly constituency which is not included in the
Assembly electoral region, or

(d) a candidate of any registered political party to be the
Assembly constituency member for an Assembly
15constituency included in the Assembly electoral
region.

(3) In section 9 (allocation of seats to electoral region members)—

(a) in subsection (4), after “as an” insert “Assembly constituency member
or”;

(b) 20in subsection (5), at the end insert “(disregarding anyone already
returned as an Assembly constituency member, including anyone
whose return is void)”;

(c) in subsection (6), for the words from “by the return” to “(2)” substitute
“(by the return of persons included on it as Assembly constituency
25members or by the previous application of subsection (1) or (2))”.

(4) In section 11(8) (electoral region vacancies)—

(a) for paragraphs (a) to (c) substitute—

(a) was returned as an Assembly member at that election
(even if the return was void), or

(b) 30has subsequently been returned under section 10 or this
section (even if the return was void),;

(b) in the words after paragraph (c) omit “, or of the successful candidate
at the election,”.

3 MPs to be disqualified from membership of Assembly

(1) 35In section 16(1) of GOWA 2006 (disqualification from being Assembly
member), before paragraph (a) insert—

(za) is a member of the House of Commons (but see sections 17A
and 17B),.

(2) After section 17 of that Act insert—

17A 40Exception from disqualification by virtue of being an MP: recently
elected members

(1) A person returned at an election as an Assembly member is not
disqualified under section 16(1)(za) (disqualification by virtue of being
an MP) at any time in the period of 8 days beginning with the day the
45person is so returned.

(2) Subsection (3) applies where a person—

(a) is returned at an election as an Assembly member,

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(b) on being so returned is a candidate for election to the House of
Commons, and

(c) is subsequently returned at that election as a member of that
House.

(3) 5The person is not disqualified under section 16(1)(za) at any time in the
period of 8 days beginning with the day the person is returned as a
member of the House of Commons.

(4) A person is a “candidate for election to the House of Commons” if the
person’s nomination paper for election as a member of the House of
10Commons has been delivered to the returning officer under rule 6 of
Schedule 1 to the Representation of the People Act 1983 (parliamentary
election rules).

17B Exception from disqualification by virtue of being an MP: general
election of Assembly members within 372 days

(1) 15This section applies if—

(a) an Assembly member is returned as a member of the House of
Commons, and

(b) the expected day of the next general election of Assembly
members is within the period of 372 days beginning with the
20day the person is so returned (“the return day”).

(2) The member is not disqualified under section 16(1)(za) (disqualification
by virtue of being an MP) at any time in the period—

(a) beginning with the return day, and

(b) ending immediately before the day of the next general election
25of Assembly members.

(3) For the purposes of subsection (1)(b) the expected day of the next
general election of Assembly members is to be determined by reference
to the circumstances as at the beginning of the return day (“the relevant
time”).

(4) 30Where, at the relevant time, section 5(2) or (3) (extraordinary general
elections) applies—

(a) if an Order in Council under section 5(4) has been made, the
expected day is the day on which the poll is required to be held
in accordance with that Order;

(b) 35if no Order in Council under section 5(4) has been made but a
day has been proposed under section 5(1), that is the expected
day;

(c) otherwise, the expected day is to be treated as being within the
period mentioned in subsection (1)(b).

(5) 40For the purpose of determining the expected day, no account is to be
taken of the possibility of—

(a) an order under section 4 (power to vary date of ordinary
general election) being made after the relevant time, or

(b) section 5(2) or (3) (extraordinary general elections) first
45applying after that time.

(6) References in this section to the “day” of the election are to the day on
which the poll at the election is held.

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(3) The National Assembly for Wales (Representation of the People) Order 2007
(S.I. 2007/236S.I. 2007/236) is amended as follows.

(4) In article 34 (false statements in nomination papers), at the end of paragraph
(5)(c) insert “or to the best of his knowledge and belief he is disqualified only
5under section 16(1)(za) of the 2006 Act (disqualification of MPs)”.

(5) In Schedule 5 (Assembly election rules), in rule 9(4)(c)(ii) (consent to
nomination) after “Assembly” insert “or that to the best of his knowledge and
belief he is disqualified for membership of the Assembly only under section
16(1)(za) of the 2006 Act (disqualification of MPs)”.

10Welsh Government

4 The Welsh Government

(1) The Welsh Assembly Government is renamed the Welsh Government, or
Llywodraeth Cymru.

(2) Accordingly, in GOWA 2006—

(a) 15omit “Assembly” wherever it occurs in the expression “Welsh
Assembly Government”;

(b) omit “Cynulliad” where it occurs in section 45(1) (in both places).

(3) In the following sections of GOWA 2006, as amended by subsection (2), the
references to the Welsh Government include, in relation to any time before the
20coming into force of this section, references to the Welsh Assembly
Government—

(a) section 37(5) (power to impose requirements on current or former
members of staff of the Government);

(b) section 52(7)(a) and (8) (power to pay pensions in respect of current or
25former members of staff of the Government).

(4) Unless the context requires otherwise, in any enactment, instrument or other
document passed or made before the date on which this section comes into
force (except GOWA 2006 - as to which see subsections (2) and (3))—

(a) any reference to the Welsh Assembly Government is to be read as, or as
30including, a reference to the Welsh Government, and

(b) any reference to Llywodraeth Cynulliad Cymru is to be read as, or as
including, a reference to Llywodraeth Cymru.

5 First Minister: removal of power to designate after dissolution of Assembly

In section 46 of GOWA 2006 (the First Minister), at the end of subsection (5)(c)
35(designation if First Minister ceases to be Assembly member) insert “otherwise
than by reason of a dissolution”.

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Part 2 Finance

Introductory

6 Taxation: introductory

(1) 5GOWA 2006 is amended as follows.

(2) After Part 4 insert—

Part 4A Taxation
CHAPTER 1 Introductory
116A 10Overview of Part 4A

(1) In this Part—

(a) Chapter 2 confers on the Assembly power to set a rate of income
tax to be paid by Welsh taxpayers, and

(b) Chapters 3 and 4 specify the taxes about which the Assembly
15may make provision in the exercise of the power conferred by
section 107(1).

(2) The power to make provision about a devolved tax is subject to the
restrictions imposed by—

(a) subsection (3), and

(b) 20the other provisions of this Part.

(3) A devolved tax may not be imposed where to do so would be
incompatible with any international obligations.

(4) In this Act “devolved tax” means a tax specified in this Part as a
devolved tax.

116B 25Status of officials of body that collects and manages devolved taxes

(1) This section applies where an Act of the Assembly establishes a body
that is to be responsible for the collection and management of devolved
taxes (whether or not the body is also to be responsible for local
government finance or any other matter).

(2) 30In this section “relevant official” means an officer or member of staff of
the body mentioned in subsection (1) who has no functions other than
functions relating to—

(a) the collection or management of devolved taxes, or

(b) local government finance.

(3) 35If an Act of the Assembly provides that service as a relevant official is
service in the civil service of the State, that provision is treated as falling
within section 108(4) or (5) (legislative competence).

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(4) In subsections (5) to (7), “relevant civil servant” means a relevant
official whose service is service in the civil service of the State by virtue
of provision of the kind mentioned in subsection (3).

(5) The Welsh Ministers must pay the salaries and expenses of relevant
5civil servants.

(6) The Welsh Ministers must make payments to the Minister for the Civil
Service, at such times as the Minister for the Civil Service may
determine, of such amounts as may be so determined in respect of—

(a) the provision of pensions, allowances or gratuities by virtue of
10section 1 of the Superannuation Act 1972 or section 1 of the
Public Service Pensions Act 2013 to or in respect of persons who
are or have been relevant civil servants, and

(b) the expenses incurred in administering those pensions,
allowances and gratuities.

(7) 15The Welsh Ministers may make payments towards the provision of
pensions, allowances or gratuities to or in respect of any person who is
or has been a relevant civil servant.

116C Power to add new devolved taxes

(1) Her Majesty may by Order in Council amend this Part so as to—

(a) 20specify, as an additional devolved tax, a tax of any description, or

(b) make any other modifications of the provisions relating to devolved
taxes which She considers appropriate.

(2) An Order in Council under this section may make such modifications of—

(a) any enactment (including any enactment comprised in or made under
25this Act) or prerogative instrument, or

(b) any other instrument or document,

as Her Majesty considers appropriate in connection with the provision made
by the Order.

(3) No recommendation is to be made to Her Majesty in Council to make
30an Order in Council under this section unless a draft of the statutory
instrument containing the Order has been laid before, and approved by
a resolution of, each House of Parliament and the Assembly.

(4) The amendment of this Part by an Order in Council under this section
does not affect—

(a) 35the validity of an Act of the Assembly passed before the
amendment comes into force, or

(b) the previous or continuing operation of such an Act of the
Assembly.

(3) In section 108 (legislative competence of the Assembly)—

(a) 40in subsection (4)(a), after “Schedule 7 and” insert “, subject to subsection
(4A),”;

(b) after subsection (4) insert—

(4A) Provision relating to a devolved tax (as listed under the heading
“Taxation” in Part 1 of Schedule 7) is not outside the Assembly’s
45legislative competence by reason only of the fact that it falls
within an exception specified under another heading in that
Part of that Schedule.

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(4) In section 111 (proceedings on Bills), in subsection (8), for “and 116(3)”
substitute “, 116(3) and 116C(4)”.

(5) In section 158(2) (references to enactments), after “109(2)” insert “, 116C(2)”.

(6) In section 159 (index of defined expressions), at the appropriate place insert—

devolved tax 5section 116A(4)

(7) Part 1 of Schedule 7 (legislative competence to make Acts of the Assembly) is
amended as follows.

(8) In paragraph 4 (economic development), in the first exception, after “Fiscal,
economic and monetary policy” insert “(except so far as relating to devolved
10taxes)”.

(9) After paragraph 16 insert—

Taxation

16A Devolved taxes (as defined in section 116A(4)).

7 Amendments relating to the Commissioners for Revenue and Customs

(1) 15In section 1(1) of the Customs and Excise Management Act 1979
(interpretation), in the definition of “assigned matter”, after “the Scotland Act
1998” insert “or the Government of Wales Act 2006”.

(2) The Commissioners for Revenue and Customs Act 2005 is amended in
accordance with subsections (3) to (13).

(3) 20In section 15 (agency), after subsection (2) insert—

(3) For the purposes of section 83 of the Government of Wales Act 2006
(agency arrangements)—

(a) the Commissioners are to be treated as a relevant authority, and

(b) the officers of Revenue and Customs are to be treated as a
25relevant authority.

(4) Accordingly, the heading to that section becomes “Agency: Scotland, Northern
Ireland and Wales”.

(5) In section 17(5) (use of information), in paragraph (a), after “Act,” insert—

(aa) an Act of the National Assembly for Wales or an instrument
30made under such an Act,.

(6) Section 18 (confidentiality) is amended in accordance with subsections (7) to
(9).

(7) In subsection (2)—

(a) omit “or” at the end of paragraph (h);

(b) 35after paragraph (i) insert , or

(j) which is made to the Welsh Ministers in connection with
the collection and management of a devolved tax within
the meaning of the Government of Wales Act 2006.

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(8) In subsection (2A), after “subsection (2)(i)” insert “or (j)”.

(9) In subsection (4)(e), in sub-paragraph (i), after “Act,” insert—

(ia) an Act of the National Assembly for Wales or an
instrument made under such an Act,.

(10) 5In section 40(11) (confidentiality), in paragraph (a), after “Act,” insert—

(aa) an Act of the National Assembly for Wales or an instrument
made under such an Act,.

(11) Section 51 (interpretation) is amended in accordance with subsections (12) and
(13).

(12) 10In subsection (1), in the definition of “enactment”, after paragraph (b) insert—

(ba) an Act of the National Assembly for Wales,

(bb) an instrument made under an Act of the National Assembly for
Wales,.

(13) After subsection (2A) insert—

(2B) 15Nor does such a reference include a function which—

(a) is conferred on the Commissioners or on officers of Revenue
and Customs by or by virtue of an Act of the National Assembly
for Wales or an instrument made under such an Act, and

(b) relates to a devolved tax within the meaning of the Government
20of Wales Act 2006.

Welsh rate of income tax

8 Welsh rate of income tax

In Part 4A of GOWA 2006 (as inserted by section 6), after Chapter 1 insert—

CHAPTER 2 Income Tax
116D 25Power to set Welsh rate for Welsh taxpayers

(1) The Assembly may by resolution (a “Welsh rate resolution”) set the Welsh rate
for the purpose of calculating the rates of income tax to be paid by Welsh
taxpayers.

(2) See section 6B of the Income Tax Act 2007 for provision about the calculation
30of those rates and section 11B of that Act for provision about the income
charged at those rates.

(3) A Welsh rate resolution applies—

(a) for only one tax year, and

(b) for the whole of that year.

(4) 35A Welsh rate resolution may specify only one rate.

(5) The Welsh rate must be a whole number or half a whole number.

(6) A Welsh rate resolution—

(a) must specify the tax year for which it applies,

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(b) must be made before the start of that tax year, and

(c) must not be made more than 12 months before the start of that year.

(7) If a Welsh rate resolution is cancelled before the start of the tax year for which
it is to apply—

(a) 5the Income Tax Acts have effect for that year as if the resolution had
never been made, and

(b) the resolution may be replaced by another Welsh rate resolution.

(8) The standing orders must provide that only the First Minister or a Welsh
Minister appointed under section 48 may move a motion for a Welsh rate
10resolution.

116E Welsh taxpayers

(1) For any tax year, a Welsh taxpayer is an individual (T)—

(a) who is resident in the UK for income tax purposes for that year
(see Schedule 45 to the Finance Act 2013), and

(b) 15who, for that year, meets condition A, B or C.

(2) T meets condition A if T has a close connection with Wales (see section
116G).

(3) T meets condition B if—

(a) T does not have a close connection with England, Scotland or
20Northern Ireland (see section 116G), and

(b) T spends more days of that year in Wales than in any other part
of the UK (see section 116H).

(4) T meets condition C if, for the whole or any part of the year, T is—

(a) a member of Parliament for a constituency in Wales,

(b) 25a member of the European Parliament for Wales, or

(c) an Assembly member.

(5) Subsection (1) does not apply if T is a Scottish parliamentarian for the
whole or any part of the year (see section 116F).

(6) For the purposes of subsection (5) and section 116F, T is a Scottish
30parliamentarian if T is a member as described in any of paragraphs (a)
to (c) of section 80D(4) of the Scotland Act 1998 (definition of a Scottish
taxpayer).

(7) In this Chapter “the UK” means the United Kingdom.

116F Welsh taxpayers: Scottish parliamentarians

(1) 35An individual (T) who is a Scottish parliamentarian for the whole or
any part of a tax year is a Welsh taxpayer for that tax year if—

(a) T is resident in the UK for income tax purposes for that year (see
Schedule 45 to the Finance Act 2013),

(b) T meets condition C in section 116E for that year, and

(c) 40T meets either of the following conditions for that year.

(2) T meets the first condition if—

(a) the number of days in that year on which T is a member as
described in any of paragraphs (a) to (c) of section 116E(4),

exceeds