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Public Bill Committee: 19th June 2008                  

469

 

Finance Bill, continued

 
 

(4)    

A statutory instrument containing regulations under subsection (2) may not be

 

made unless a draft of it has been laid before and approved by resolution of the

 

House of Commons.’.

 


 

Overpayment of tax credits

 

Mr Simon Hughes

 

Mr Jeremy Browne

 

NC2

 

To move the following Clause:—

 

‘If HMRC have overpaid tax credits to any person, they may not reclaim such

 

overpayments where—

 

(a)    

the amount overpaid is £5,000 or less and the person’s annual income is

 

less than £10,000, or

 

(b)    

the amount overpaid is £2,500 or less and the person’s annual income is

 

less than £20,000.’.

 


 

Exemption for bingo

 

Mr Jeremy Browne

 

Dr Vincent Cable

 

Mr Colin Breed

 

Dr John Pugh

 

John Thurso

 

NC3

 

To move the following Clause:—

 

‘(1)    

Group 4 (betting, gaming and lotteries) of Schedule 9 to the Value Added Tax Act

 

1994 is amended as follows.

 

(2)    

After Note (5)(e) insert “, or

 

(f)    

bingo which is played pursuant to a bingo operating licence.”.

 

(3)    

After Note (11) insert—

 

“(12)    

In Note (5)(f) “bingo operating licence” means such a licence as is

 

provided for in section 65(2)(b) of the Gambling Act 2005.”’.

 


 

Fuel duty regulator

 

Mr Stewart Hosie

 

NC4

 

To move the following Clause:—


 
 

Public Bill Committee: 19th June 2008                  

470

 

Finance Bill, continued

 
 

‘In HODA 1979 in section 6 (excise duty on hydrocarbon oil) there is inserted

 

after subsection (1A)—

 

“(1AA)    

In every Budget Statement and pre-Budget Report the Chancellor of the

 

Exchequer shall provide his forecast for the price of oil and set out

 

anticipated yield from fuel duty and VAT on fuel for that price and for a

 

range of prices up to 50 per cent. above his forecast.

 

(1AB)    

In the 2008 pre-Budget Report the Chancellor of the Exchequer shall

 

bring forward a mechanism for—

 

(a)    

using additional revenue from VAT on fuel above forecast to

 

offset fuel duty when the oil price rises above his forecast level;

 

(b)    

providing specific fuel duty reductions targeted at fuel sold in

 

sparsely populated areas; and

 

(c)    

providing specific fuel duty reductions targeted at fuel sold to

 

road haulage operators;

 

    

and the Chancellor of the Exchequer shall by order define “sparsely

 

populated areas” and “road haulage operators” for the purposes of this

 

subsection.

 

(1AC)    

Whenever international oil prices return to the level estimated by the

 

forecast made in accordance with subsection (1AA), the offset described

 

in subsection (1AB) (a) to (c) is suspended until the price rises again or

 

the forecast price is amended by the next Budget or pre-Budget

 

Report.”.’.

 


 

Definition of residence

 

Mr Jeremy Browne

 

Dr Vincent Cable

 

Mr Colin Breed

 

Dr John Pugh

 

NC5

 

To move the following Clause:—

 

‘(1)    

An individual is resident in the United Kingdom for income tax purposes if—

 

(a)    

during the tax year in question the individual spends (in total) more than

 

31 days in the United Kingdom; and

 

(b)    

during the three-year period that includes the tax year in question and the

 

two tax years immediately preceding it the individual has spent (in total)

 

183 or more days in the United Kingdom, including—

 

(i)    

the total number of days spent in the United Kingdom in the tax

 

year in question,

 

(ii)    

one-third of the days in the tax year immediately preceding the

 

tax year referred to in sub-paragraph (i), and

 

(iii)    

one-sixth of the days in the tax year immediately preceding the

 

tax year referred to in sub-paragraph (ii).

 

(2)    

An individual found to be resident under subsection (1) shall be liable for income

 

tax on both their UK income and capital gains and any foreign income and capital

 

gains remitted to the United Kingdom.


 
 

Public Bill Committee: 19th June 2008                  

471

 

Finance Bill, continued

 
 

(3)    

In determining whether an individual fulfils the definition of residence under

 

subsection (1) treat each day the individual is physically present in the United

 

Kingdom as a day spent by the individual in the United Kingdom.

 

(4)    

But in determining that issue do not treat as a day spent by the individual in the

 

United Kingdom any day on which the individual—

 

(a)    

arrives in and departs from the United Kingdom on the same day;

 

(b)    

is present in the United Kingdom for less than 24 hours for transit only;

 

(c)    

is present in the United Kingdom by virtue of being employed as a crew

 

member of a foreign vessel;

 

(d)    

is unable to leave the United Kingdom on the same day owing to a

 

medical condition;

 

(e)    

is enrolled in full-time higher education in the United Kingdom;

 

(f)    

is an exempt individual.

 

(5)    

The Treasury shall, by regulations, define an exempt individual.

 

(6)    

Regulations under subsection (5) shall be made by statutory instrument.

 

(7)    

A statutory instrument containing regulations under subsection (5) may not be

 

made unless a draft of it has been laid before and approved by resolution of the

 

House of Commons.

 

(8)    

On the coming into force of this section, Chapter 2 of ITA 2007 shall cease to

 

have effect.’.

 


 

VAT on beverages

 

Mr Philip Hammond

 

Mr Mark Hoban

 

Mr David Gauke

 

Justine Greening

 

NC10

 

To move the following Clause:—

 

‘The Treasury shall, not later than six months after the passing of this Act, prepare

 

and lay before the House of Commons a report setting out the estimated costs to

 

the Exchequer, and the estimated health benefits to the population of the United

 

Kingdom, of reducing the amount of VAT payable on beverages containing fruit

 

juice to the lowest level permitted.’.

 


 

Fiscal impact of water charging in Northern Ireland

 

Mr Philip Hammond

 

Mr Mark Hoban

 

Mr David Gauke

 

Justine Greening

 

NC11

 

To move the following Clause:—


 
 

Public Bill Committee: 19th June 2008                  

472

 

Finance Bill, continued

 
 

‘The Treasury shall, before the publication of the 2008 Pre-Budget Report,

 

prepare and lay before the House of Commons a report setting out its estimate of

 

the revenue gain for the Exchequer from the introduction of water charging in

 

Northern Ireland in each year to 2015.’.

 


 

Report on impact of Finance Bill on older people

 

Mr Philip Hammond

 

Mr Mark Hoban

 

Mr David Gauke

 

Justine Greening

 

NC13

 

To move the following Clause:—

 

‘It shall be the duty of the Treasury to prepare and lay before the House of

 

Commons, at the time of publication of each Finance Bill, a report on the impact

 

on individuals aged 60 and over of the measures contained in that Finance Bill.’.

 


 

Report on impact of Finance Bill on people on low incomes

 

Mr Philip Hammond

 

Mr Mark Hoban

 

Mr David Gauke

 

Justine Greening

 

NC14

 

To move the following Clause:—

 

‘It shall be the duty of the Treasury to prepare and lay before the House of

 

Commons, at the time of publication of each Finance Bill, a report on the impact

 

on individuals in the lowest income decile of the population of the measures

 

contained in that Finance Bill.’.

 


 

Report on exemption from taxation of foreign profits

 

Mr Philip Hammond

 

Mr Mark Hoban

 

Mr David Gauke

 

Justine Greening

 

NC15

 

To move the following Clause:—

 

‘(1)    

The Treasury shall, before the publication of the 2008 Pre-Budget report, prepare

 

and lay before the House of Commons a report on the effects of introducing a


 
 

Public Bill Committee: 19th June 2008                  

473

 

Finance Bill, continued

 
 

measure to exempt from corporation tax all dividends from non-portfolio

 

investments paid to UK resident companies.

 

(2)    

For the purposes of this section, a non-portfolio investment is one where the UK

 

company holds at least 10 per cent. of the ordinary share capital of the investee

 

company.

 

(3)    

The report under subsection (1) shall include consideration of the effect of such a

 

measure on—

 

(a)    

the public finances;

 

(b)    

UK companies;

 

(c)    

the competitiveness of the UK economy;

 

(d)    

the attractiveness of the UK as a location for multinational headquarters;

 

(e)    

the impact on repatriation of foreign profits back to the UK and the likely

 

effects on investment; and

 

(f)    

the extent to which special measures would be needed to protect against

 

diversion of profits through countries with a low rate of corporation tax.’.

 


 

International Accountancy Standards

 

Mr Philip Hammond

 

Mr Mark Hoban

 

Mr David Gauke

 

Justine Greening

 

NC16

 

To move the following Clause:—

 

‘The Treasury shall lay before Parliament not later than 31st October 2008 a

 

report on progress towards the introduction of International Accountancy

 

Standards for all government departments and public sector entities.’.

 


 

PAYE reporting

 

Mr Philip Hammond

 

Mr Mark Hoban

 

Mr David Gauke

 

Justine Greening

 

NC17

 

To move the following Clause:—

 

‘The Treasury shall commission and lay before the House of Commons, within

 

12 months of the passing of this Act, an independent report into the feasibility and

 

estimated cost of introducing a system of monthly reporting to HM Revenue and

 

Customs of payments and deductions through the Pay as You Earn system.’.

 



 
 

Public Bill Committee: 19th June 2008                  

474

 

Finance Bill, continued

 
 

Harmonisation of income tax and national insurance contributions

 

Mr Philip Hammond

 

Mr Mark Hoban

 

Mr David Gauke

 

Justine Greening

 

NC18

 

To move the following Clause:—

 

‘(1)    

If for any tax year—

 

(a)    

the personal allowance under section 35 of the Income Tax Act 2007 (c.

 

3) is set at an amount which is not equal to the amount of the primary

 

threshold under section 5 of the Social Security Contributions and

 

Benefits Act 1992 (c. 4), or

 

(b)    

the sum of the personal allowance and the basic rate limit under sections

 

35 and 10(2) of the Income Tax Act 2007 (c. 3) is set at an amount which

 

is not equal to the upper earnings limit under section 5 of the Social

 

Security Contributions and Benefits Act 1992 (c. 4),

 

    

the Treasury shall within one month of the passing of the Act which sets the

 

personal allowance or basic rate limit lay before Parliament a report explaining

 

the matters set out in subsection (2).

 

(2)    

Those matters are—

 

(a)    

why the amounts have diverged for the year, and the expected future path

 

of the amounts in relation to each other; and

 

(b)    

the estimated cost to—

 

(i)    

employers, and

 

(ii)    

HMRC,

 

    

of operating a system of divergent thresholds and the savings that are

 

expected to result from a convergence of those thresholds.’.

 


 

Retirement Income Fund

 

Mr Philip Hammond

 

Mr Mark Hoban

 

Mr David Gauke

 

Justine Greening

 

NC19

 

To move the following Clause:—

 

‘(1)    

The Finance Act 2004 is amended as follows.

 

(2)    

In section 164 at end add “and

 

(g)    

payments into a Retirement Income Fund.”.

 

(3)    

In section 165 there is inserted in Pension rule 6 after paragraph (c) “or

 

(d)    

a withdrawal from a Retirement Income Fund.”.

 

(4)    

In section 165 after Pension rule 7 there is inserted—

 


 

Pension rule 8

 

Before a member makes a withdrawal from a Retirement Income Fund, he must

 

buy a relevant linked annuity which is linked to the retail prices index, which pays

 

an income equivalent to the Minimum Income Requirement.”.


 
 

Public Bill Committee: 19th June 2008                  

475

 

Finance Bill, continued

 
 

(5)    

In Schedule 28 after paragraph 16C there is inserted—

 

“Retirement Income Fund

 

16D(1)  

Subject to sub-paragraphs (2) and (3) of this paragraph, a Retirement

 

Income Fund is a vehicle for the reinvestment of savings in retirement,

 

which—

 

(a)    

has been established by a person designated by subsection (1)

 

of section 154; and

 

(b)    

is a vehicle the investments in which are—

 

(i)    

investments of a kind described in the Insurance

 

Companies Regulations 1994, Schedule X, Part 1, or

 

(ii)    

approved by HM Revenue and Customs.

 

      (2)  

Funds held in the Retirement Income Fund as referred to in sub-

 

paragraph (1) may be withdrawn from the Retirement Income Fund by

 

the member as and when he elects.

 

      (3)  

A member may not invest in a Retirement Income Fund unless the

 

requirements of Rule 8 of section 165 have been met.

 

      (4)  

A Retirement Income Fund, and any income derived from it, must not

 

be capable of assignment or surrender by the member.

 

      (5)  

Any withdrawal from the Fund by the member under sub-paragraph

 

(2) shall be assessable to tax under Schedule E (and section 203 shall

 

apply accordingly) and shall be treated as earned income of the

 

member.

 

Minimum Retirement Income

 

16E(1)  

The amount of Minimum Retirement Income shall be set for each

 

financial year following consultation by the Chancellor of the

 

Exchequer by order.

 

      (2)  

An order under this paragraph shall, in respect of each financial year

 

after that in which this section comes into force, be made on or before

 

31st January preceding the year in question.

 

      (3)  

An order under this paragraph shall be made by statutory instrument

 

and shall be subject to annulment in pursuance of a resolution of either

 

House of Parliament.”’.

 


 

Dependant’s retirement income fund

 

Mr Philip Hammond

 

Mr Mark Hoban

 

Mr David Gauke

 

Justine Greening

 

NC20

 

To move the following Clause:—

 

‘(1)    

The Finance Act 2004 is amended as follows.


 
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