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House of Commons

 
 

Monday 13th June 2005

 

Committee of the Whole House

 

Proceedings

 

Finance Bill

 

(Clauses 11, 18, 40, 43, 44 and 69 and Schedule 8)

 

Mr Chancellor of the Exchequer

 

To move, That the Order in which proceedings in the Committee of the whole House

 

on the Finance Bill are to be taken shall be Clauses 11, 18 and 40, Schedule 8, Clauses 43,

 

44 and 69

 

Agreed to

 

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Withdrawn  36

 

Clause  11,  page  11,  line  40,  at end insert—

 

‘(h)    

interactive experiments with an educational purpose.’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Negatived on division  35

 

Clause  11,  page  12,  line  1,  leave out ‘one year’ and insert ‘three months’.

 

Stephen Hammond

 

Not called  1

 

Clause  11,  page  12,  line  8,  after ‘family’, insert ‘or of that person and an

 

accompanying group of no more than twenty individuals.’.

 

Clause Agreed to.

 

 
 

Committee of the whole House Proceedings: 13th June 2005    

2

 

Finance Bill, continued

 
 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Withdrawn  2

 

Clause  18,  page  17,  line  9,  at end insert—­­­­­­­­­­­

 

‘(i)    

in relation to unit trust schemes and open-ended investment companies

 

mainly invested in interests or rights in or over land, determine the rate

 

of corporation tax for the year 2005 and subsequent financial years to be

 

nil, or the rate at which income tax at the lower rate is charged for year

 

of assessment which begins on 6th April in the financial year concerned.

 

(j)    

include provision for unit trust schemes and open-ended investment

 

companies to have different classes of units or shares, and to allow

 

different distributions to be made in respect of such different classes

 

subject always to any rules preventing discrimination between unit

 

holders or shareholders made under section 64(2)(e).’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  3

 

Clause  18,  page  17,  line  21,  at end insert—­­­­­­­­­­­

 

‘(f)    

make special provision for any interest or rights in or over land held by a

 

unit trust scheme or open-ended investment company and may make

 

special provision for withholding tax on distributions from an authorised

 

investment fund, mainly invested in interests or rights over land, and may

 

determine specific circumstances when such tax must be withheld.’.

 

Clause Agreed to.

 

Clause 40 Agreed to.

 

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Withdrawn  10

 

Schedule  8,  page  124,  line  23,  leave out ‘in relation to the financing arrangements’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  8

 

Schedule  8,  page  124,  leave out lines 29 and 30.

 
 

Committee of the whole House Proceedings: 13th June 2005    

3

 

Finance Bill, continued

 
 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  38

 

Schedule  8,  page  124,  line  32,  leave out ‘the’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  9

 

Schedule  8,  page  124,  line  33,  after ‘arrangements’, insert ‘for A’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  7

 

Schedule  8,  page  125,  leave out lines 3 and 4.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  12

 

Schedule  8,  page  125,  line  5,  leave out ‘B’ and insert ‘One of the affected persons

 

(B)’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  13

 

Schedule  8,  page  125,  line  6,  leave out ‘the’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  14

 

Schedule  8,  page  125,  line  7,  after ‘arrangements’, insert ‘for B’.

 
 

Committee of the whole House Proceedings: 13th June 2005    

4

 

Finance Bill, continued

 
 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  17

 

Schedule  8,  page  125,  line  9,  leave out ‘person’ and insert ‘persons’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  15

 

Schedule  8,  page  125,  line  34,  after ‘provision’, leave out ‘relates to’ and insert

 

‘has been made or imposed in connection with’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  39

 

Schedule  8,  page  125,  line  35,  at end insert ‘and would not have been made or

 

imposed in the absence of those financing arrangements’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Negatived on division  16

 

Schedule  8,  page  125,  line  35,  at end insert—

 

‘(8)    

This paragraph shall apply only to a person where that person, or a connected

 

party to that person, owns shares or an interest in shares, in either A or B.’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Withdrawn  18

 

Schedule  8,  page  125,  line  45,  leave out from beginning to end of line 23 on page

 

126.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  19

 

Schedule  8,  page  126,  line  23,  at end insert—

 

    ‘(6)    

after paragraph 13 insert—

 
 

Committee of the whole House Proceedings: 13th June 2005    

5

 

Finance Bill, continued

 
 

“Transfer pricing guidelines

 

    

Schedule 28AA ICTA 1988 is amended as follows.

 

13A    

The Treasury may for the purposes of paragraph 4A Schedule 28AA ICTA 1988,

 

by regulations—

 

      (1)    

make provisions determining what may constitute arm’s length provision

 

for any financing arrangement, by making reference to—

 

(a)    

income cover; and

 

(b)    

debt: equity ratios in respect of a company’s financing

 

arrangements as defined in paragraph 4A.

 

      (2)    

Under subparagraph (1) different provisions may be made for different

 

categories of business.

 

13B      (1)    

Where, for an accounting period, the financing arrangements of a

 

company or group of companies come within the parameters set in the

 

regulations made in accordance with paragraph 13A then paragraph 5(1)

 

of this Schedule shall not apply to such financing arrangements unless

 

they differ from the financing arrangements that would have been made

 

as between independent enterprises.

 

      (2)    

For the purposes of this paragraph and paragraph 13A of this Schedule,

 

“financing arrangements” means arrangements made for providing or

 

guaranteeing, or otherwise in connection with, any debt, capital or other

 

form of finance.”.’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Withdrawn  26

 

Schedule  8,  page  126,  line  23,  at end insert—

 

    ‘( )    

Paragraph 5D shall be amended as follows—

 

Leave out subparagraphs (1) to (6) and replace with—

 

  “(1)  

Small enterprise means an enterprise that has no more than 50 staff,

 

and either an annual turnover in the preceding accounting period or

 

a net asset value at the end of the preceeding accounting period of

 

less than £7 million.

 

      (2)  

Medium enterprise means an enterprise that has no more than 250

 

staff, and either an annual turnover in the preceding accounting

 

period of less than £35 million or a net asset value at the end of the

 

preceding accounting period of less than £30 million.

 

      (3)  

“Annual turnover” and “net asset value” shall be defined in

 

accordance with generally accepted accounting practice.

 

      (4)  

The number of staff shall be determined on the basis that staff that

 

are not full time should be counted at the appropriate fraction.”.’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Withdrawn  20

 

Schedule  8,  page  126,  line  25,  leave out paragraph 2.

 
 

Committee of the whole House Proceedings: 13th June 2005    

6

 

Finance Bill, continued

 
 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  21

 

Schedule  8,  page  127,  line  5,  leave out from ‘time’ to end of line 7.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  24

 

Schedule  8,  page  127,  line  7,  after ‘the’, insert ‘accounting period immediately

 

preceding the’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  22

 

Schedule  8,  page  127,  line  16,  leave out from ‘satisfied’ to end of line 18.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  25

 

Schedule  8,  page  127,  line  18,  after ‘the’, insert ‘accounting period immediately

 

preceding the’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  23

 

Schedule  8,  page  127,  line  23,  leave out from ‘1988’ to end of line 25.

 
 

Committee of the whole House Proceedings: 13th June 2005    

7

 

Finance Bill, continued

 
 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  27

 

Schedule  8,  page  127,  line  26,  leave out paragraph 3.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  28

 

Schedule  8,  page  128,  line  5,  after ‘the’, insert ‘immediately preceding

 

accounting’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  29

 

Schedule  8,  page  128,  line  17,  after ‘the’, insert ‘immediately preceding

 

accounting’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  30

 

Schedule  8,  page  128,  line  39,  leave out sub-paragraph (3).

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  34

 

Schedule  8,  page  129,  line  3,  leave out ‘or (3)’.

 

Mr George Osborne

 

Mr Philip Hammond

 

Mr Richard Spring

 

Mr Mark Field

 

Mr Mark Francois

 

Not called  33

 

Schedule  8,  page  129,  line  11,  leave out ‘or (3)’.

 
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