Finance (No. 3) Bill (HC Bill 282)

(6) In paragraph 1GE (rates for light passenger vehicles registered on or after 1
April 2017 with a price exceeding £40,000), in sub-paragraph (4) for “£310”
substitute “£320”.

(7) In paragraph 1J (rates for light goods vehicles), in paragraph (a) for “£250”
5substitute “£260”.

(8) In paragraph 2(1) (rates for motorcycles)—

(a) in paragraph (a) for “£19” substitute “£20”,

(b) in paragraph (b) for “£42” substitute “£43”,

(c) in paragraph (c) for “£64” substitute “£66”, and

(d) 10in paragraph (d) for “£88” substitute “£91”.

(9) The amendments made by this section have effect in relation to licences taken
out on or after 1 April 2019.

58 VED: taxis capable of zero emissions

(1) Part 1AA of Schedule 1 to VERA 1994 (annual rates of duty: light passenger
15vehicles first registered on or after 1 April 2017) is amended as follows.

(2) In paragraph 1GE (higher rates for vehicles with price above £40,000), after
sub-paragraph (4) insert—

“(5) Sub-paragraphs (2) and (4) do not apply to a vehicle if when it is first
registered, whether that is under this Act or under the law of a
20country or territory outside the United Kingdom, it is a taxi capable
of zero emissions (see paragraph 1GG).”

(3) After paragraph 1GF insert—

““Meaning of “taxi capable of zero emissions”

1GG (1) The Secretary of State may by regulations make provision about the
25meaning of “taxi capable of zero emissions” in paragraph 1GE.

(2) In the following provisions of this paragraph “regulations” means
regulations under sub-paragraph (1).

(3) Regulations may (in particular) make provision of any one or more
of the following kinds—

(a) 30that a vehicle is a taxi capable of zero emissions if the vehicle
is of a description specified in regulations;

(b) that a vehicle is at any particular time a taxi capable of zero
emissions if the vehicle is of a model specified at that time in
a list maintained by the Secretary of State;

(c) 35that a vehicle is a taxi capable of zero emissions if conditions
specified in regulations are met.

(4) Where regulations make provision of the kind mentioned in sub-
paragraph (3)(b)—

(a) regulations may (in particular) provide that a model of
40vehicle may be specified in the list only if it appears to the
Secretary of State that vehicles of that model are of a
description specified in regulations;

(b) regulations must provide for publication of the list;

(c) regulations may allow a model of vehicle to be included in
the list with backdated effect.

(5) A description of a kind mentioned in sub-paragraph (3)(a) or (4)(a)
may be framed (in particular) by reference to a scheme, or an
5instrument or other document, as it has effect from time to time.

(6) Regulations made before 1 April 2020 that do not increase the
amount of vehicle excise duty for which any person is liable may
have effect in relation to vehicle licences taken out at times before the
regulations come into force (including times before the regulations
10are made).”

(4) The amendments made by this section have effect in relation to licences taken
out on or after 1 April 2019.

(5) The new paragraph 1GE(5) has effect, in the case of a vehicle first registered in
the two years beginning with 1 April 2017, as if the reference to when the
15vehicle is first registered were to the start of the first period beginning on or
after 1 April 2019 for which a vehicle licence for the vehicle is taken out.

59 HGV road user levy

(1) The HGV Road User Levy Act 2013 is amended in accordance with subsections
(2) to (6).

(2) 20In section 5(5) (payment of levy for UK heavy goods vehicles) for “in Schedule
1” substitute “or Table 1A in Schedule 1 (depending on which of those Tables
applies to the vehicle)”.

(3) In section 6(4) (payment of levy for non-UK heavy goods vehicles) for “in
Schedule 1” substitute “or Table 1A in Schedule 1 (depending on which of
25those Tables applies to the vehicle)”.

(4) In section 7 (rebate of levy), after subsection (2) insert—

“(2A) A rebate entitlement also arises where—”

“HGV road user levy has been paid in respect of a vehicle at the
rate applicable to a vehicle that does not meet Euro 6 emissions
30standards, and

(b) the vehicle becomes a vehicle that meets those standards.”

(5) In section 19 (interpretation)—

(a) in subsection (3)—

(i) in paragraph (b), for “under section 7” substitute “as a result of
35an entitlement arising under section 7(2)”, and

(ii) after paragraph (b) insert—

“(c) where a person receives a rebate of levy in
respect of a vehicle as a result of an entitlement
arising under section 7(2A), the person is treated
40as not having paid levy in respect of the vehicle
for the period starting with the first day of the
month after the month in which the application
for a rebate was made and ending with the end
of the levy period.”, and”

(b) after subsection (3), insert—

“(4) For the purposes of subsection (3)(c), a month starts on the day
of the month on which the levy period started.”

(6) In Schedule 1 (rates of HGV road user levy)—

(a) 5for paragraph 1 substitute—

“1 (1) Table 1 applies to a heavy goods vehicle that meets Euro 6
emissions standards.

(2) Table 1A applies to a heavy goods vehicle that does not meet
Euro 6 emissions standards.

(3) 10Tables 1 and 1A set out the rates of levy for each of the Bands
given by Tables 2 to 5 and by paragraph 4.”;

(b) in paragraph 5, after paragraph (b) insert—

“(c) a heavy goods vehicle meets Euro 6 emissions
standards if it complies with the emission limits set
15out in Annex 1 of Regulation (EC) No. 595/2009 of the
European Parliament and of the Council of 18th June
2009 on type approval of motor vehicles and engines
with respect to emissions from heavy duty vehicles
(Euro VI) and on access to repair and maintenance
20information.”;

(c) for Table 1 substitute—

(7) 15The HGV Road User Levy (Rate for Prescribed Vehicles) Regulations 2018 (S.I.
2018/417) are revoked.

(8) In section 19 of VERA 1994 (rebates)—

(a) in subsection (3), after paragraph (g) insert—

“(h) a relevant application for a vehicle licence for the vehicle
20has been received by the Secretary of State.”,”

(b) after subsection (3ZA) insert—

“(3ZB) An application for a vehicle licence is a relevant application for
the purposes of subsection (3)(h) if—

(a) there is an unexpired licence for the vehicle in respect of
25which the application is made,

(b) when the unexpired licence was taken out, the vehicle
was chargeable to HGV road user levy under section 5
of the HGV Road User Levy Act 2013 at a rate applicable
to a vehicle that does not meet Euro 6 emissions
30standards, and

(c) the vehicle now meets those standards, and an
application for a rebate of HGV road user levy has been
made under section 7 of that Act as a result of an
entitlement arising under subsection (2A) of that
35section.”,”

(c) in subsection (7), after “rebate conditions” insert “(other than the
condition in subsection (3)(h))”, and

(d) after subsection (7) insert—

“(7A) Where the rebate condition in subsection (3)(h) is satisfied in
40relation to a licence, the licence ceases to be in force immediately

before the first day of the period for which the relevant person
is treated as not having paid levy in respect of the vehicle as a
result of section 19(3)(c) of the HGV Road User Levy Act 2013.”

(9) The amendments and revocation made by subsections (1) to (7) are to be
5treated as having effect in relation to HGV road user levy that—

(a) becomes due on or after 1 February 2019, and

(b) is paid on or after that date.

(10) The amendments made by subsection (8) are to be treated as having effect in
relation to licences taken out on or after 1 February 2019.

10Air passenger duty

60 Rates of duty from 1 April 2020

(1) In section 30 of FA 1994 (air passenger duty: rates), in subsection (4A) (long
haul rates of duty)—

(a) in paragraph (a) for “£78” substitute “£80”, and

(b) 15in paragraph (b) for “£172” substitute “£176”.

(2) Those amendments have effect in relation to the carriage of passengers
beginning on or after 1 April 2020.

Gaming

61 Remote gaming duty: rate

(1) 20In section 155(3) of FA 2014 (rate of remote gaming duty) for “15%” substitute
“21%”.

(2) That amendment has effect in relation to accounting periods beginning on or
after 1 October 2019.

(3) The amount of remote gaming duty charged in respect of an accounting period
25that begins before and ends on or after 1 October 2019 is the sum of—

(a) the amount of that duty that would have been charged in respect of the
accounting period had it consisted only of those days within the period
that fell before that date, and

(b) the amount of that duty that would have been charged in respect of the
30accounting period had it consisted only of those days within the period
that fell on or after that date and had the amendment made by
subsection (1) had effect in relation to it.

62 Gaming duty

Schedule 18 contains provision about gaming duty.

Environmental taxes

63 Climate change levy: exemption for mineralogical and metallurgical
processes

(1) Paragraph 12A of Schedule 6 to FA 2000 (exemption: mineralogical and
5metallurgical processes) is amended as follows.

(2) In sub-paragraph (1)—

(a) omit “to a person”, and

(b) omit “by the person”.

(3) In sub-paragraph (2), for the words from “has the same meaning” to the end
10substitute “means a process falling within Division 23 of NACE Rev 2.”

(4) In sub-paragraph (4), the words after paragraph (c) become sub-paragraph
(4A).

(5) In that sub-paragraph, for “sub-paragraph” substitute “paragraph”.

64 Landfill tax rates

(1) 15Section 42 of FA 1996 (amount of landfill tax) is amended as follows.

(2) In subsection (1)(a) (standard rate), for “£88.95” substitute “£91.35”.

(3) In subsection (2) (reduced rate for certain disposals), in the words after
paragraph (b)—

(a) for “£88.95” substitute “£91.35”, and

(b) 20for “£2.80” substitute “£2.90”.

(4) The amendments made by this section have effect in relation to disposals made
(or treated as made) on or after 1 April 2019.

Inheritance tax

65 Residence nil-rate band

(1) 25IHTA 1984 is amended as follows.

(2) In section 8FA(2)(b) and (5) (conditions for entitlement to downsizing
addition), for “VT”, in each place it occurs, substitute “the value transferred by
the transfer of value under section 4 on the person’s death”.

(3) In section 8FE(9) (calculation of downsizing addition in section 8FA cases), in
30Step 2, for “VT” substitute “the value transferred by the transfer of value under
section 4 on the person’s death”.

(4) In section 8E(1) (which, in relation to the person mentioned in section 8D(1),
refers to the transfer of value under section 4), after “section 4” insert “on the
person’s death”.

(5) 35In section 8J(6) (meaning of “inherited”: property disposed of before death by
gift subject to a reservation), for the words after “by way of” substitute “gift—

(a) subsections (2) to (5) do not apply, and

(b) B inherits the property if the property originally comprised in
the gift became comprised in B’s estate on the making of the
disposal.”

(6) The amendments made by this section apply for the purpose of calculating the
5amount of the charge to inheritance tax under section 4 of IHTA 1984 on a
person’s death if the person dies after 29 October 2018.

Soft drinks industry levy

66 Application of penalty provisions

(1) In Schedule 10 to F(No.3)A 2010 (which prospectively amends Schedule 55 to
10FA 2009 (penalties for failure to make returns etc)) in paragraph 7, in the
inserted paragraph 13A(1), after “7B” insert “, 13A”.

(2) The amendments to Schedule 55 to FA 2009 made by Schedule 10 to F(No.3)A
2010 (including the amendment made by subsection (1)) are taken to have
come into force for the purposes of soft drinks industry levy on the day on
15which this section comes into force.

(3) In Schedule 11 to F(No.3)A 2010 (which prospectively amends Schedule 56 to
FA 2009 (penalties for failure to make payments)) in paragraph 5(3), in the
substituted text of paragraph 3(1)(a) of Schedule 56 to FA 2009, for “11”
substitute “11ZA”.

67 20Isle of Man

(1) In section 1(1) of the Isle of Man Act 1979 (common duties), at the end insert—

“(f) soft drinks industry levy chargeable under the law of the United
Kingdom or the Isle of Man.”

(2) Part 2 of FA 2017 (soft drinks industry levy) is amended in accordance with
25subsections (3) and (4).

(3) After section 58 insert—

“58A Isle of Man: import and export of chargeable soft drinks

(1) Subsections (2) and (3) apply if—

(a) chargeable soft drinks are imported into the United Kingdom
30from the Isle of Man, and

(b) a charge to soft drinks industry levy (the “corresponding
charge”) arises in relation to the soft drinks under the law of the
Isle of Man.

(2) If the corresponding charge arises at a rate equal to, or greater than, the
35UK rate, the soft drinks are not to be treated as being imported into the
United Kingdom for the purposes of section 33 (chargeable events:
imported soft drinks).

(3) If the corresponding charge arises at a rate lower than the UK rate, the
amount of soft drinks industry levy charged under this Part in relation
40to the soft drinks is to be reduced by an amount equal to the
corresponding charge.

(4) In this section “the UK rate”, in relation to chargeable soft drinks, is the
rate of soft drinks industry levy that would (apart from this section) be
chargeable in relation to the soft drinks under this Part.

(5) For the purposes of section 39(1)(a) (tax credits: exported soft drinks) or
5regulations made under that provision, chargeable soft drinks are not
to be treated as being exported from the United Kingdom if the soft
drinks are exported to the Isle of Man.”

(4) At the end of section 33, insert—

“(10) This section is subject to section 58A (Isle of Man: import and export of
10chargeable soft drinks).”

(5) In section 39, after subsection (5) insert—

“(5A) This section is subject to section 58A (Isle of Man: import and export of
chargeable soft drinks).”

(6) This section comes into force on 1 April 2019.

15Part 3 Carbon emissions tax

Introductory

68 Carbon emissions tax

(1) A tax called “carbon emissions tax” is to be charged in accordance with this
20Part.

(2) The Commissioners are responsible for the collection and management of
carbon emissions tax.

Charge to tax

69 Charge to carbon emissions tax

(1) 25Carbon emissions tax is charged, in relation to a regulated installation, if the
amount of reported carbon emissions for a reporting period exceeds the
emissions allowance for the period.

(2) The amount of “taxable carbon emissions” in relation to the installation for the
reporting period is the amount of the excess.

(3) 30Carbon emissions tax is charged on taxable carbon emissions at the rate of £16
per tonne of carbon dioxide equivalent.

70 “Reported carbon emissions”

(1) The amount of “reported carbon emissions” in relation to an installation for a
reporting period is the total amount of emissions from the installation, in
35tonnes of carbon dioxide equivalent, that is stated—

(a) in the emissions determination (or, if there is more than one, the latest
emissions determination) for the period, or

(b) if there is no such determination, in the emissions report for the period.

(2) In subsection (1), “emissions determination” means the regulator’s estimate of
the total amount of emissions from the installation for the period, determined
in accordance with—

(a) 5article 70 of the Monitoring and Reporting Regulation, or

(b) regulation 44 of the Emissions Regulations.

71 “Emissions report” and “reporting period”

(1) In this Part, “emissions report” means a report of emissions that is submitted
to the regulator for the purpose of complying with—

(a) 10the monitoring and reporting requirements or, in the case of an
excluded installation, the monitoring and reporting conditions, or

(b) a requirement of a notice of surrender or of a revocation notice.

(2) “Reporting period”, in relation to a regulated installation, means—

(a) a scheme year, or

(b) 15such shorter period for which an emissions report for the installation is
required by a notice of surrender or a revocation notice.

72 “Emissions allowance”

The “emissions allowance”, in relation to an installation for a reporting period,
is the amount of emissions, in tonnes of carbon dioxide equivalent, specified by
20or under, or determined in accordance with, regulations made by the
Commissioners under this section.

73 Liability to pay carbon emissions tax

(1) Carbon emissions tax in relation to an installation is payable by the person
who, at the end of the reporting date, holds the permit for the installation.

(2) 25The “reporting date”, in relation to a reporting period, means the day on which
the emissions report for that period is required to be submitted to the regulator
under the Emissions Regulations.

Administration etc.

74 Power to make further provision about carbon emissions tax

(1) 30The Commissioners may by regulations—

(a) make provision about the assessment, payment, collection and
recovery of carbon emissions tax, including provision about the
recovery of overpayments;

(b) require persons to keep, for purposes connected with carbon emissions
35tax, records of specified matters, and to preserve those records for a
specified period;

(c) make provision for the review of, and a right of appeal against,
specified decisions of HMRC in connection with carbon emissions tax;

(d) make provision about the enforcement of carbon emissions tax;

(e) permit or require the sharing of information between HMRC,
authorities and regulators for purposes in connection with carbon
emissions tax;

(f) make provision about the form, manner and content of any notice,
5application or other communication with HMRC in connection with
carbon emissions tax (including provision about communications in
electronic form);

(g) make provision in relation to cases where an individual liable for
carbon emissions tax dies or becomes incapacitated, or where a person
10(whether or not an individual) is subject to an insolvency procedure.

(2) The Commissioners may by regulations make provision for purposes in
connection with carbon emissions tax—

(a) about the submission of emissions reports to a regulator;

(b) about emissions determinations, including provision permitting or
15requiring a regulator to make an emissions determination in specified
circumstances;

(c) specifying conditions to be included in a permit granted by a regulator;

(d) for the review of, and a right of appeal against, specified decisions of a
regulator;

(e) 20about the performance of a function of a regulator;

(f) about the form, manner and content of any notice, application or other
communication with a regulator (including provision about
communications in electronic form).

(3) Regulations under this section may, in particular—

(a) 25make provision that is equivalent to, or applies with or without
modification, any provision of an enactment relating to tax;

(b) amend the Monitoring and Reporting Regulation or the Verification
Regulation.

75 Consequential provision

(1) 30In section 1 of the Provisional Collection of Taxes Act 1968 (temporary
statutory effect of House of Commons resolutions), in subsection (1), after
“petroleum revenue tax” insert “, carbon emissions tax,”.

(2) In regulation 52 of the Emissions Regulations (penalty for carrying out a
regulated activity without a permit), after paragraph (2) insert—

“(2A) 35In paragraph (2), the reference to “costs” includes a reference to carbon
emissions tax.”

(3) Section 4(1) of the European Union (Withdrawal) Act 2018 does not apply, for
the purposes of carbon emissions tax, in relation to any rights, powers,
liabilities, obligations, restrictions, remedies and procedures so far as they arise
40under—

(a) Council Directive 2008/118/EC of 16 December 2008 concerning the
general arrangements for excise duty, or

(b) Council Directive 2003/96/EC of 27 October 2003 restructuring the
Community framework for the taxation of energy products and
45electricity.

(4) The Commissioners may by regulations make such provision as they consider
appropriate in consequence of this Part.