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Mr. Douglas Hogg (Sleaford and North Hykeham): Will the hon. Lady be good enough to tell the House how the Committee will be composed, and what balance of party representation there will be?
Dawn Primarolo: That was to be my next point. At present, we expect the Committee to be composed of 13 members in all, of whom seven will be from this House. The details of the Committee's procedure are still being discussed through the usual channels and will be subject to final agreement.
The fact that the tax law rewrite Bill deals with matters that are traditionally the concern of the Commons is recognised by the fact that the Committee is expected to have a Commons Chairman and a Commons majority, as recommended by the Procedure Committee. The Committee will consider the Bill and amend it if necessary. It will, of course, be alert to ensure that no more than minor changes are made and that the procedures are not abused.
The Bill will bring together some 300 pages of legislation, which is currently found in various places. The main legislation is in the Capital Allowances Act 1990, which is, itself, a consolidation Act that brought together earlier legislation.
Mr. Hogg: Will the Committee be able to call evidence as though it were a Special Standing Committee? The House may well think that, in this sort of technical matter, accountants and others should testify to the merits or defects of a Bill to such a Committee.
Dawn Primarolo: The project has already produced four drafts of legislation--the latest in August 2000. I understand--this will be for the final agreement of the House when the procedure is agreed--that the Committee will decide how best to proceed on scrutiny of the legislation. That will be a matter for the Chairman and members.
Mr. Hogg: Are we to understand that the Committee can take evidence if the Chairman and the Committee so determine?
Dawn Primarolo: Yes. I think that I made that clear. If the Committee determines to do that, it would be the case. It is for the Committee to determine how it wants to proceed.
Extensive consultation procedures have been the hallmark of the rewrite project's work to date. There was a round of consultations on four separate drafts of the proposed legislation between October 1998 and February 2000, with the latest draft Bill published in August 2000.
This project is immensely worth while. It will modernise our direct tax legislation, making it clearer and easier to use. The first Bill is a milestone in the projects's work and will show what improvements are possible. In order for it to become law, we need to continue the work undertaken by the previous Administration. In fairness, I must acknowledge the work that they undertook to initiate the project and set the broad parameters. We are taking it forward--I hope with the agreement of the House--to establish a new procedure by which this and successive Bills can be scrutinised and enacted.
The measure is an important step in that direction and I hope that it will command the support of the House. I also hope that, as the legislation proceeds through Parliament, it will enlighten the House about how such Bills can be scrutinised.
10.45 pm
Mr. Richard Ottaway (Croydon, South): I am grateful to the Minister for recognising that the previous Government initiated the project. I share her view that it is worth while and I look forward to producing something constructive through the passage of the legislation. Under the circumstances, we do not oppose the measure.
10.48 pm
Mr. Edward Davey (Kingston and Surbiton): The Liberal Democrats will also support the measure, which is historic in that it changes the way in which we deal with tax legislation.
The tax law rewrite project, which was proposed by the previous Government, is incredibly important. Simplifying the language in which the House and its
Committees write our tax legislation is long overdue. Anyone who has tried to work out what tax statutes mean knows that they can be incredibly confusing. As we move towards more self-assessment in both the personal and the business tax sectors, it is important that the legislation by which people have to abide is easily accessible to the wider audience.We have no problem with the procedure before us. However, we need to go much further. One problem is that the previous and the present Governments have made the tax system far more complicated. The tax law rewrite project is restricted in the way in which it can simplify the tax system. It has been given the remit to restrict itself simply to the language in which the law is expressed, not to deal with the effects that it gives to tax liabilities.
The technical aspects--as well as the language in which the law is expressed--need to be simplified to ensure that there is real tax simplification. I hope that the House accepts this historic measure and that we use it to modernise our procedures with cross-party support. That will ensure that the output of this place is better--not merely in its language, but in its impact on business and compliance costs.
We should develop the link with the other place. The fact that there is to be a Joint Committee is welcome, because Members of the other place can make a positive contribution to some of the complex aspects of these matters. I should like to see the establishment of a House of Lords Select Committee on tax simplification as well as the Joint Committee; it could offer this place some serious lessons.
I do not want to detain the House; but I want to mark this historic occasion. I hope that the Government will be motivated by the success of this measure, which has received cross-party support, to go further in reforming our procedures so that we can more effectively scrutinise tax legislation and make it much simpler.
10.51 pm
Mr. David Wilshire (Spelthorne): In principle, the measure is a good idea. I am bound to say that because we thought of it in the first place. I am grateful to the Paymaster General for acknowledging that we got something right--I am always pleased to hear that, although I knew it all along.
I am a little confused by the wording of the motion. Will the hon. Lady explain it? I had assumed that we should take a decision on the matter this evening, so I expected the wording of the motion to be "That this House decides to set up a Joint Committee". As those words do not appear, I am baffled.
- That it is expedient that a Joint Committee of both Houses be appointed.
The hon. Lady tells us that the other place will discuss the motion; presumably the Lords will say, "Hey, this is a good idea" and send it back to us. It is only at that stage that we shall be asked to pass a motion that states that we
shall do something. I hope that is the position--otherwise the wording of the motion makes no real sense; it merely expresses a good idea.When the motion comes back to this place for decision, I hope that we shall be given more detail than was included on today's Order Paper. The Paymaster General kindly gave us some information, but it took the prodding of my right hon. and learned Friend the Member for Sleaford and North Hykeham (Mr. Hogg) to elicit details such as how many people would serve on the Committee. It would be helpful if such matters could be decided by the House, rather than by the usual channels carving things up between them in a quiet corner. If the usual channels want the backing of the House, they should ask us to endorse matters rather than telling us about them after they have made a decision. I hope that the hon. Lady can help me on that point.
I am not an expert in financial matters, but I was schooled in the principle that there should be no taxation without representation. The motion is on tax, but I am being asked to agree that Members of the other place, who are not elected, should have a say in taxation matters. I thought that did not happen in this country. The Paymaster General has not yet explained why undemocratic and unelected people should have a say in such matters.
Perhaps that is an admission that, at long last, the Government are going to finish the job of reforming the other place and will ensure that its members are elected. Thus, when the Committee is finally set up--after we have been asked to vote on it--its members from the other place will have a democratic mandate and will be entitled to an involvement in taxation matters. If my understanding is correct, at present, they are not so entitled. I should therefore be grateful if the hon. Lady could put me out of my misery on that point when she sums up.
10.55 pm
Mr. Michael Jack (Fylde): I speak as the former Financial Secretary who established the mechanisms that, I hope, the House will approve this evening, and as a member of the rewrite steering committee. I thank the Paymaster General for supporting the endeavour that the previous Government started in trying to translate the existing tax code into plain English. I also thank her for enthusiastically developing the project.
It would be wrong if I did not put on record my appreciation of the work of the Inland Revenue officials who have laboured very hard indeed to start translating into plain English our complex tax legislation, for without their efforts, we could not discuss the procedure for dealing with the first Bill produced by the tax rewrite exercise.
The product that the Joint Committee will consider reflects the input of many tax practitioners, who have enthusiastically welcomed the efforts involved in such improvements. As the hon. Member for Kingston and Surbiton (Mr. Davey) said, the exercise has thrown up several issues that go beyond the original Committee's remit. The previous Administration designed the procedures and the remit; the current Administration have followed them to the letter. However, many members of the Revenue feel frustrated because they would like the next step, following the rewrite exercise, to involve not
necessarily a change in tax law, but a modification to improve the existing procedures. I should like both things to happen in parallel, but I do not wish to trespass too far beyond the motion.
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