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Mr. Letwin: Let me make it clear, for the avoidance of doubt, that these are alternatives. The commissioners need to satisfy themselves of either the first, the second or the third. The amendment is even more modest than my hon. Friend suggests.
Mr. Fabricant: My hon. Friend is right. Reasonableness is the essence of the amendment. The question--the acid test--is this: are the Government going to be reasonable, and do they want the commissioners to be reasonable?
I know that the Financial Secretary is a reasonable lady, although she and her bedfellows--perhaps I should not say that; she and her colleagues--lack business experience. I therefore hope that they will accept the amendment.
Mrs. Roche:
I find myself in a quandary. To misquote Oscar Wilde, I can resist everything but flattery. I have heard two flattering speeches, from the hon. Members for West Dorset (Mr. Letwin) and for Lichfield (Mr. Fabricant); however, I must disappoint them this evening. [Hon. Members: "Oh!"] I know: it almost brings tears to my eyes as well.
I was rather surprised by the speech of the hon. Member for Lichfield. He will know of the many hard-working men and women in our Customs and Excise service who do such sterling work for us on a number of issues--not just on VAT, but on combating drugs and smuggling. It is incumbent on hon. Members on both sides of the House to pay tribute to those brave men and women.
Mr. Letwin:
I hope that the Minister might recognise the following point. It is the only defence of those hard-working and conscientious individuals that there should be rules that ensure that they do not have to fulfil their function by acting arbitrarily to squeeze every last penny out of every rock. I hope that she will recognise that the intention is precisely to protect those individuals, not to attack them.
Mrs. Roche:
I am grateful for that clarification, because I had thought for a moment that the all-party consensus on law and order issues was in danger of breaking down. If the hon. Gentleman is a little patient, I think I can reassure him.
The one thing that the hon. Members for West Dorset and for Lichfield did not mention was that, if one looks at the whole package, of which the measure is a very small part, the Government's proposals on the sector have been welcomed by business as a whole. The proposals are the result of a long period of consultation and have gone down well.
The power to remove companies is necessary, as customs currently has powers to refuse applications to groups on revenue protection grounds, but no powers to remove companies when the same revenue concerns arise involving an existing group member. The inability of customs to remove companies from groups facilitates abuse and can lead to distortions of competition. Anyone who believes that having a level playing field is good will not support the amendment.
Mr. Letwin:
Will the hon. Lady give way?
Mrs. Roche:
I am anxious to make a little progress. I want to say something that might help the hon. Gentleman. I will be nice to him, so will he take his seat for a moment?
I am sure that it is not the intention of those who have tabled the amendment to facilitate abuse, especially in light of the successive years of legislation--the hon. Member for West Dorset was generous enough to say, unlike some of his right hon. and hon. Friends, that Conservative Governments have gone down exactly the
same route--that have been necessary to counter some of the abuse of what is an important business facilitation measure. That includes legislation that was passed by the Opposition when they were in power.
Members who have read the Hansard--the hon. Member for West Dorset has already referred to it--of the Standing Committee debate will know that the criterion in the amendment is the same criterion that my hon. Friend the Paymaster General said would be applied by customs to all the revenue protection powers in the clause.
Mr. Letwin:
Now the hon. Lady is absolutely right. All we are trying to do is to enshrine in law what her colleague said would be a matter of practice. How can she possibly object to that? Is not that the ultimate reasonable activity of Parliament--to enshrine in law what is regarded as reasonable practice?
Mrs. Roche:
I know that the hon. Gentleman is anxious about the matter, but, if he contains himself for a little longer, I will deal with that.
The amendment seeks to set that criterion in law in respect of the new powers to remove companies from groups for the protection of revenue, but the amendment is defective. I have had to take Conservative Members to task before when they have tabled amendments that are technically defective because my right hon. and hon. Friends might be tempted by such amendments, which would put them on a path that could not be said to be one of righteousness. There is no mention of the approach that should be taken over refusing applications on the same grounds. Rather than creating more certainty for business, this limited amendment would create more uncertainty and reintroduce distortions--precisely what the Bill is meant to overcome.
Although the amendment may be superficially attractive, when we look at its detail, it raises more questions than it solves. Customs will apply, as it always does, those good principles, but there are sound--
Mr. Letwin:
Will the hon. Lady give way?
Amendment No. 1 deals with a very important matter. I am sorry that, today, Opposition Members have not sought to talk--as they were generous enough to do in Committee--about the great benefits for business that the Bill will provide.
Amendment No. 1 would only confuse the issue, and I urge the House to reject it.
| Chapter | Short title |
| Extent of repeal | 1992 c. 12. |
| The Taxation of Chargeable Gains Act 1992. | Section 193. |
This repeal has effect in accordance with section (Business assets: roll-over relief)(2) of this Act.'.--[Mrs. Roche.]
Order for Third Reading read.
9.46 pm
The Chief Secretary to the Treasury (Mr. Alan Milburn): I beg to move, That the Bill be now read the Third time.
The Finance Bill reforms and strengthens the British economy by rewarding work, enterprise and families. Quite rightly, it has been subjected to detailed scrutiny, both on Report and in Committee. I thank all right hon. and hon. Members, some of whom are in the Chamber, who contributed to our consideration of the Bill in Committee. I particularly thank my hon. Friends for the excellence of their work on the Bill, but also thank Opposition Members for their work--not least because it has given us some profound insights into where they stand on so many key issues of tax policy, spending policy and economic policy.
The Bill helps to lock in the economic stability that the Government have been creating since we entered office, and introduces new measures to improve--for the long term--the productivity and performance of the British economy. The Bill contains measures to improve investment, to strengthen links between business and education, and to improve the tax position of growing firms.
The Bill's measures give Britain the lowest rates of company taxation in our history. Indeed, the measures give us the lowest tax rates of any major industrialised country anywhere in the world. Moreover, those rates will not apply for only one year, but will remain at that level, or below, for the remainder of this Parliament. They are evidence of the Government's determination to make Britain the very best place for businesses to invest, and the very best place for businesses to do business.
The Finance Bill helps put in place the building blocks not only for an enterprise economy, but for a fair society--the current Government, unlike the previous one, recognise that the two go together. In our two previous Budgets, we helped people move from welfare
to work. We are now taking that fundamental reform a step further, by ensuring that, when people go into work, it pays.
For years, successive Governments have taken too much tax from those who work hard but are by no means wealthy. All too often, the working poor have paid the price for that failure. Some people have faced marginal tax rates of as much as 100 per cent. or more when trying simply to move off benefit and into work.
The Finance Bill, with the minimum wage and the working families tax credit, begins to end the perverse incentives that have encouraged benefit dependency. We do so in recognition, first, that work is the best way out of poverty; and, secondly, that--for too many people, for far too long--financial uncertainty has acted as a real barrier.
The Bill ensures that we now have the lowest starting income tax rate in 35 years. Next year, we will have the lowest basic rate of income tax in some 70 years. On any count, those are major reforms to the tax system. They will make working families better off. They will cut the tax burden on the average family to below 20 per cent. for the first time in more than 20 years.
In contrast to the practice of the Conservative party when it was in power, those tax cuts honour the pledges that we made at the last election. [Interruption.] Before the shadow Chancellor starts to chunter too much, I say to him that the cuts are a reminder--if reminder were needed--that, while this Government keep our tax promises, the previous Government failed to do keep theirs. We said that we would cut VAT on fuel and that we would introduce a 10p rate of income tax. We have done so.
We said that we would do something else--we promised more support for families. This Finance Bill delivers that promise. The new children's tax credit will provide more help to those who need it most, when they need it most--families bringing up children. By the end of this Parliament, we will be spending £6 billion more on children than we were at the beginning. In total, as a result of the measures that we have taken to date, some 700,000 children will be lifted out of poverty.
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