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Mr. Heathcoat-Amory: I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

1 Jul 1998 : Column 373

Clause 11

Rates of gaming duty

Dawn Primarolo: I beg to move amendment No. 19, in page 5, leave out lines 35 to 40 and insert--

'Table


Part of gross gaming yieldRate
The first £450,000 2½ per cent.
The next £1,000,00012½ per cent.
The next £1,000,00020 per cent.
The next £1,750,00030 per cent.
The remainder40 per cent.'

During an earlier debate on clause 11 on the Floor of the House, in response to points made by several hon. Members, particularly the hon. Member for Rochford and Southend, East (Sir T. Taylor), I undertook to re-examine the table in clause 11 and its specific impact on casinos outside London whose gross gaming yield was in the range of £5 million to £12 million annually. The hon. Gentleman said that the provision would have a damaging impact on casinos and cited the cases of casinos in his own constituency.

Government amendment No. 19 will replace the table in clause 11--which will substitute for the table of gaming duty rates in section 11(2) of the Finance Act 1997--introduce new 20 per cent. and 30 per cent. duty rate bands, and revise the gross gaming yield thresholds set out in clause 11.

I agreed to consider the matter further, and there have been discussions with the industry on how the objectives could be achieved. In the light of representations about the impact of the Budget changes on the casino industry, I have tabled the amendment. I should say that, unfortunately, the industry was itself unable to reach any consensus on the model that it would prefer. I suppose that I should not be surprised that a number of individual groups offered proposals that met their own objectives but not necessarily those of their competitors.

Government amendment No. 19 will reduce the burden on casinos that are within the £5 million to £12 million gross gaming duty range. The Government's amendment deals with the specific point that was raised and will significantly reduce the burden on casinos in that range. I ask the House to agree to the amendment.

Mr. Michael Fallon (Sevenoaks): Another day, another climbdown; we welcome it.

Sir Teddy Taylor (Rochford and Southend, East): From the Back Benches, I should like to pay tribute to the Minister for the detailed consideration that she gave to the case that we advanced, and to assure her that her detailed consideration and great understanding of the matter are greatly appreciated. I should like her to know that Back Benchers very much appreciate the Government amendment. It is greatly welcome in Southend-on-Sea, where we have many problems.

Amendment agreed to.

1 Jul 1998 : Column 374

Clause 47

Gifts in kind for relief in poor countries


Amendments made: No. 1, in page 26, line 25, leave out from 'used' to end of line 26 and insert
'in a designated country or territory either for medical purposes or by an educational establishment in that country or territory.'.
No. 2, in page 27, line 35, leave out 'and'.
No. 3, in page 27, line 37, at end insert
'and
"medical purposes" includes medical research and the promotion of health.'.--[Dawn Primarolo.]

Clause 51

Convertible shares provided to directors and employees

The Economic Secretary to the Treasury (Mrs. Helen Liddell): I beg to move amendment No. 15, in page 35, line 27, leave out 'or securities'.

This is a very simple amendment, the purpose of which is to remove from clause 51 two unnecessary words. Under the clause, employees who receive shares that subsequently convert to shares of another class pay income tax on the value of the new class of shares, less anything that they paid when they first received the shares. The amendment will simply ensure that employees who receive such shares are fairly taxed and closes a potential tax avoidance opportunity.

Convertible securities do not present the same problems and are therefore excluded from the scope of the clause. However, there is a reference to convertible shares or securities in one subsection of the clause. Although the reference to securities does not in any way change the effect of the clause, it might lead to some confusion. We have therefore decided to remove the two unnecessary words.

Amendment agreed to.

Clause 73

Other changes to requirements for VCTs


Amendments made: No. 4, in page 60, line 12, leave out
'(5) The preceding provisions of this section'
and insert--
'(4A) In paragraph 8(1) of Schedule 28B to that Act (requirement as to capital of the relevant company), for "£10 million" and "£11 million" there shall be substituted, respectively, "£15 million" and "£16 million".
(5) Subsections (1) to (4) above'.
No. 5, in page 60, line 14, at end insert
'; and subsection (4A) above has effect in relation to relevant holdings issued on or after that date.'.--[Dawn Primarolo.]

Clause 75

Use of PEPs powers to provide for accounts


Amendments made: No. 20, in page 60, line 40, leave out from beginning to 'there' in line 41 and insert--
'(3) In paragraph (b) of subsection (4) of that section (power to provide for persons to be liable to account for tax wrongly relieved)--

1 Jul 1998 : Column 375


(a) after "Board" there shall be inserted "either--
(i)";
and
(b) after "it" there shall be inserted "or
(ii) for an amount determined in accordance with the regulations to be the amount which is to be taken to represent such tax;".
(4) In paragraph (c) of that subsection (adaptation and modification of enactments to secure tax accounted for), in sub-paragraph (iii) after "tax" there shall be inserted "and other amounts".
(5) After that paragraph'.
No. 21, in page 61, line 6, after 'above;' insert--
'(cc) that an investor under a plan or a plan manager is, in prescribed cases where relief has been given to which there was no entitlement, to be liable to a penalty of a prescribed amount, instead of to any obligation to account as mentioned in paragraph (b) or (cb) above;
(cd) that liabilities equivalent to any of those which, by virtue of any of the preceding paragraphs of this subsection, may be imposed in cases where relief has been given to which there was no entitlement are to arise (in place of the liabilities to tax otherwise arising) in other cases where, in relation to any plan--
(i) a prescribed contravention of, or failure to comply with, the regulations, or
(ii) the existence of such other circumstances as may be prescribed,
would have the effect (subject to the provision made by virtue of this paragraph) of excluding or limiting an entitlement to relief;'.
No. 22, in page 61, line 6, at end insert--
'(6) In section 151(2) of the Taxation of Chargeable Gains Act 1992 (application of subsections (2) to (5) of section 333 of the Taxes Act 1988 to relief from capital gains tax in respect of investments under plans), for "(2)" there shall be substituted "(1A)".'.--[Dawn Primarolo.]

Clause 77

The insurance element etc.


Amendments made: No. 23, in page 63, line 9, leave out 'of the provisions of' and insert
'provision made by or under'.
No. 24, in page 63, line 13, at end insert--
'(7A) Without prejudice to the generality of the powers conferred by subsection (7) above, the provision that may be made in connection with an exemption from tax conferred by virtue of subsection (1) above shall include provision for section 436 to apply (with any such modifications as may be prescribed) in relation to section 333 business as it applies in relation to pension business.'.--[Dawn Primarolo.]

Clause 82

Carry forward of non-trading deficit on loan relationships


Amendments made: No. 9, in page 67, line 7, at end insert--
'(1A) Section 797 (limits on credit: corporation tax) and section 797A (foreign tax on interest brought into account as a non-trading credit) of the Taxes Act 1988 are amended as follows--
(a) in section 797(3B)(b), omit "or in accordance with subsection (3) of that section";
(b) in section 797A(5), at the end of paragraph (a) insert the word "and" and omit paragraph (c) and the word "and" preceding it;
(c) at the end of section 797A(5), insert--

1 Jul 1998 : Column 376


"An amount carried forward to the applicable accounting period under section 83(3) of that Act shall not be treated as a non-trading deficit for that period for the purposes of paragraphs (a) and (b).";
(d) in section 797A(6) for "specified in subsection (5)(c) above" substitute "carried forward to the applicable accounting period in pursuance of a claim under section 83(2)(d) of that Act";
(e) at the end of section 797A(7) insert--
"An amount carried forward to the applicable accounting period under section 83(3) of the Finance Act 1996 shall be disregarded for the purposes of paragraphs (a) and (b).".'.
No. 10, in page 67, line 10, at end insert--
'(aa) in paragraph 6(da), after "period" insert "(other than one within sub-paragraph (dc) below)";'.
No. 11, in page 67, line 13, at end insert--
'(ba) in paragraph 7(1)(b), for "debit" substitute "deficit";'.
No. 12, in page 67, line 14, at end insert--
'(ca) in paragraph 13(1)(ea), after "period" insert "(other than one within paragraph (ec) below)";'.
No. 13, in page 67, line 18, at end insert--
'(f) in paragraph 16(1)(b), for "debit" substitute "deficit".'.--[Dawn Primarolo.]

Clause 83

First-year allowances for small businesses etc.


Amendments made: No. 25, in page 67, line 26, leave out
'subsection (3C) of that section'
and insert
'the subsection (3CC) of that section inserted by section (First-year allowances for investment in Northern Ireland) above.'.
No. 26, in page 67, line 38, leave out from beginning to end of line 3 on page 68.--[Dawn Primarolo.]

Clause 119

Taper relief for CGT

4.30 pm

Mr. Malcolm Bruce (Gordon): I beg to move amendment No. 42, in page 108, line 40, at end insert--


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