Finance Bill

House of Commons

Session 2007 - 08
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Finance Bill

Finance Bill (Volume I)
Part 8 — Miscellaneous
89

(a)
the country or territory is neither a member State nor a part of a
member State, and
(b)
there is no provision for mutual assistance between the United
Kingdom and the country or territory similar in scope to the
assistance provided for between the United Kingdom and each
5
other member State by the mutual assistance provisions.
(1B)
In subsection (1A) above “the mutual assistance provisions” means—
(a)
section 134 of, and Schedule 39 to, the Finance Act 2002
(recovery of taxes etc due in other member States), and
(b)
section 197 of the Finance Act 2003 (exchange of information
10
between tax authorities of member States).”
Vehicle excise duty
141
Rebates
(1)
VERA 1994 is amended as follows.
(2)
In section 10 (transfer and surrender of vehicle licences), omit subsections (2)
15
and (3) and, in the heading, “and surrender”.
(3)
For section 19 (rebates on surrender of licences) substitute—
“19
Rebates
(1)
If the relevant person makes an application to the Secretary of State
under this subsection for a rebate of the duty paid on a vehicle licence
20
in force for a vehicle, the person is entitled to receive from the Secretary
of State the amount specified in subsection (2).
(2)
That amount is an amount equal to one-twelfth of the annual rate of
duty chargeable on the licence (at the time when it was taken out) in
respect of each complete month of the period of the currency of the
25
licence which is unexpired when the application is made.
(3)
An application under subsection (1) may only be made if—
(a)
the vehicle has been stolen,
(b)
the vehicle has been destroyed and the Secretary of State is
notified of that,
30
(c)
an application for a nil licence for the vehicle is made in
accordance with regulations under section 22,
(d)
the vehicle is neither used nor kept on a public road and the
particulars and declaration required to be furnished and made
by regulations under section 22(1D) are furnished and made in
35
relation to it in accordance with the regulations,
(e)
the vehicle has been sold or disposed of and the particulars
prescribed by regulations under section 22(1)(d) are furnished
in relation to it in accordance with the regulations, or
(f)
the vehicle has been removed from the United Kingdom with a
40
view to its remaining permanently outside the United Kingdom
and the Secretary of State is notified of that.
(4)
In subsection (1) “the relevant person” means the person in whose
name the vehicle is registered at the time when the application is made;

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but in a case within subsection (3)(e) also includes the person in whose
name it was registered immediately before being sold or disposed of.
(5)
The Secretary of State may specify conditions which must be complied
with by a person before making an application under subsection (1).
(6)
The conditions that may be specified include (in particular)—
5
(a)
a condition requiring the surrender of the licence,
(b)
a condition requiring that particulars which are required to be
furnished to the Secretary of State are transmitted to the
Secretary of State by such electronic means as may be specified,
and
10
(c)
in a case within subsection (3)(a), conditions relating to the
reporting to the police that the vehicle has been stolen.
(7)
Where an application is made under subsection (1) and the licence is
not surrendered on the making of the application, it ceases to be in force
when the application is made.
15
(8)
Where a trade licence is surrendered to the Secretary of State under
section 14(2), the holder of the licence is entitled to receive from the
Secretary of State (by way of rebate of the duty paid on the licence) an
amount equal to one-twelfth of the annual rate of duty chargeable on
the licence (at the time when it was taken out) in respect of each
20
complete month of the period of the currency of the licence which is
unexpired at the date of the surrender.”
(4)
In section 22(1D) (requirement to furnish particulars etc in certain
circumstances), omit paragraph (a) (surrender under section 10(2)).
(5)
In—
25
(a)
section 31(7)(a),
(b)
section 31B(9)(a)(i), and
(c)
section 31C(7)(a),

(meaning of “expiry”), after “surrender” insert “or ceasing to be in force under
section 19(7)”.
30
(6)
In consequence of the amendment made by subsection (3), omit section 14 of
FA 2001.
(7)
The amendments made by this section come into force on 1 January 2009.
142
Offence of using or keeping unlicensed vehicle
Schedule 45 contains provision in relation to the offence of using or keeping an
35
unlicensed vehicle.
143
Rates for new lower-emission vans
(1)
Part 1B of Schedule 1 to VERA 1994 (annual rates of duty: light goods vehicles)
is amended as follows.
(2)
In paragraph 1J(a) and (b) (rates), after “a” insert “pre-2007 or post-2008”.
40
(3)
In paragraph 1K (meaning of “lower-emission van”), for ““lower-emission
van”” substitute ““pre-2007 lower-emission van””.

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(4)
After paragraph 1L insert—
“1M
For the purposes of paragraph 1J, a vehicle to which this Part of this
Schedule applies is a “post-2008 lower-emission van” if—
(a)
the vehicle is first registered on or after 1 January 2009 and
before 1 January 2011,
5
(b)
it is a vehicle to which Regulation (EC) No 715/2007 of the
European Parliament and of the Council applies (see Article
2 of that Regulation),
(c)
it is powered by a compression ignition engine, and
(d)
the emissions from it do not exceed any of the emission limit
10
values specified in Table 1 of Annex 1 to that Regulation in
relation to vehicles so powered.”
144
Not exhibiting licence: period of grace
In section 33 of VERA 1994 (not exhibiting licence), after subsection (1A)
insert—
15
“(1B)
A person is not guilty of an offence under subsection (1) or (1A) by
using or keeping a vehicle on a public road during any of the 5 working
days following the time when a licence or nil licence for the vehicle, or
a relevant declaration applying to the vehicle, ceases to be in force, if an
application for a licence or nil licence for or in respect of the vehicle to
20
run from that time has been received before that time.
(1C)
In subsection (1B) “working day” means any day other than—
(a)
a Saturday or Sunday, or
(b)
a day which is Christmas Eve, Christmas Day, Good Friday or
a bank holiday under the Banking and Financial Dealings Act
25
1971 in any part of the United Kingdom.
(1D)
For the purposes of subsection (1B)—
(a)
there is a relevant declaration applying to a vehicle if the
particulars and declaration required to be furnished and made
by regulations under section 22(1D) have been furnished and
30
made in relation to the vehicle in accordance with the
regulations, and
(b)
the relevant declaration ceases to be in force if, after the
particulars and declaration have been furnished and made—
(i)
the vehicle is used or kept on a public road (otherwise
35
than under a trade licence), or
(ii)
the period of 12 months beginning with the day on
which the particulars and declaration were furnished
and made expires.”
145
Reduced pollution certificates
40
(1)
Section 61B of VERA 1994 (certificates as to reduced pollution) is amended as
follows.
(2)
In subsection (1), after paragraph (b) insert—
“(ba)
for the production of information and making of declarations
for the purposes of a determination (including provision about
45
the person to whom, and the time at which and manner in

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which, the information is to be produced and the declarations
are to be made);”.
(3)
In paragraph (c) of that subsection, for “examination of an eligible vehicle, for
the purposes of the determination mentioned in paragraph (b),” substitute
“Secretary of State to specify cases in which a determination is to be made only
5
after an examination of an eligible vehicle”.
(4)
In paragraph (d) of that subsection, for “for such an examination” substitute “in
respect of a determination”.
(5)
In paragraph (e) of that subsection, for “on a prescribed examination,”
substitute “in accordance with the regulations,”.
10
(6)
In subsection (3)—
(a)
in paragraph (a), for “in accordance with the regulations” substitute
“(or, if not previously examined, examined) in accordance with the
regulations (“a post-certification examination”)”,
(b)
in paragraph (b), for “such a re-examination” substitute “a post-
15
certification examination”, and
(c)
in paragraph (c), for “the prescribed re-examination” substitute “a post-
certification examination”.
Climate change levy and landfill tax
146
Climate change levy: coal mine methane no longer to be renewable source
20
(1)
In paragraph 19 of Schedule 6 to FA 2000 (exemption: electricity from
renewable sources), omit sub-paragraph (4A) (coal mine methane to be
regarded as renewable source).
(2)
Accordingly, omit—
(a)
section 126 of FA 2002 (which inserted sub-paragraph (4A)), and
25
(b)
regulation 47(2A) of the Climate Change Levy (General) Regulations
2001 (S.I. 2001/838).
(3)
The repeals and revocation made by this section have effect in relation to
electricity generated on or after 1 November 2008.
147
Climate change levy accounting documents: abolition of self-identification
30
In paragraph 143(2) of Schedule 6 to FA 2000 (requirements to be met by
invoice if it is to be a “climate change levy accounting document”), omit
paragraph (a) (requirement that it must state that it is a climate change levy
accounting document).
148
Landfill tax credit: withdrawing approval of environmental bodies
35
(1)
Part 3 of FA 1996 (landfill tax) is amended as follows.
(2)
In section 53(4)(d) (withdrawal of approval of environmental body or
regulatory body), for “approval of an environmental body or the regulatory
body to be withdrawn” substitute “the withdrawal of approval of an
environmental body by the Commissioners or by the regulatory body, and the
40
withdrawal of approval of the regulatory body by the Commissioners,”.

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(3)
In section 54(1) (review of Commissioners’ decisions), after paragraph (c)
insert—
“(ca)
a decision to withdraw approval of an environmental body
under any provision contained in regulations by virtue of
section 53(4)(d) above;”.
5
(4)
The amendments made by this section are treated as having come into force on
19 March 2008.
Aviation
149
Aviation duty
The Commissioners for Her Majesty’s Revenue and Customs may incur
10
expenditure in preparing for the introduction of a new duty chargeable in
respect of flights by aircraft.
150
Air passenger duty: class of travel with large seat pitch
(1)
In section 30 of FA 1994 (rate of air passenger duty), after subsection (10)
insert—
15
“(11)
But a class of travel is not standard class travel if the seats for
passengers whose agreement for carriage provides for that class of
travel have a pitch exceeding 1.016 metres (40 inches).
(12)
For this purpose “pitch”, in relation to a seat, means the distance
between a fixed point on the seat and the same point on the seat
20
immediately in front of it; but where there is no seat immediately in
front of the seat, the seat is to be treated as having the same pitch as the
seat immediately behind it.”
(2)
The amendment made by subsection (1) has effect in relation to any carriage of
a passenger on an aircraft which begins on or after 1 November 2008.
25
Alternative finance arrangements
151
Stamp duty and stamp duty reserve tax: alternative finance investment bonds
(1)
FA 1986 is amended as follows.
(2)
In section 78 (stamp duty: loan capital), after subsection (7)(c) insert—
“(d)
any capital raised under arrangements which fall within section
30
48A of the Finance Act 2005 (alternative finance investment
bonds).”
(3)
Section 79 (loan capital: instruments not chargeable to stamp duty) is amended
as follows.
(4)
After subsection (8) insert—
35
“(8A)
In the application of this section to loan capital that falls within
paragraph (d) of section 78(7) (alternative finance investment bonds)—
(a)
subsection (6) has effect as if—
(i)
paragraph (a) were omitted, and

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(ii)
for paragraph (c) there were substituted—
“(c)
a right at the end of the bond term (within the
meaning of section 48A(1) of the Finance Act
2005) to a payment of an amount that exceeds the
aggregate of—
5

   (i) the amount paid for the issue of the bond,

   and

   (ii) the notional payment amount;

and for this purpose the “notional payment
amount” means the amount of the payments that
10
would represent a reasonable commercial return
(within the meaning of section 48A(1) of the
Finance Act 2005) on the bond over the bond
term, less the amount of the payments actually
made.”,
15
(b)
subsections (6)(b), (7), (7A), (7B) and (13) have effect as if
references to interest were references to additional payments
(“additional payments” having the same meaning as in section
48A of the Finance Act 2005), and
(c)
subsections (7B) and (13) also have effect as if—
20
(i)
references to a capital market investment were
references to the loan capital falling within paragraph
(d) of section 78(7), and
(ii)
references to a capital market arrangement were to the
arrangements under which that loan capital is raised.”
25
(5)
In section 99 (stamp duty reserve tax: interpretation), after subsection (9)
insert—
“(9A)
But “unit trust scheme” does not include arrangements falling within
section 48A of the Finance Act 2005 (alternative finance investment
bonds).”
30
(6)
The amendments made by subsections (2) to (4) have effect in relation to
instruments executed on or after the day on which this Act is passed (and for
this purpose it does not matter when the arrangements falling within section
48A of FA 2005 are made).
(7)
The amendment made by subsection (5) has effect in relation to—
35
(a)
agreements to transfer chargeable securities made on or after the day
on which this Act is passed, and
(b)
the transfer, issue or appropriation of chargeable securities after that
day in pursuance of an agreement made after that day;

(and for this purpose it does not matter when the arrangements falling within
40
section 48A of FA 2005 are made).
152
Alternative property finance: anti-avoidance
(1)
FA 2003 is amended as follows.
(2)
For the heading of section 73A substitute “Sections 71A to 73: relationship
with Schedule 7”.
45

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(3)
After section 73A insert—
“73AB
  Sections 71A to 72A: arrangements to transfer control of financial
institution
(1)
Section 71A, 72 or 72A does not apply to alternative finance
arrangements if those arrangements, or any connected arrangements,
5
include arrangements for a person to acquire control of the relevant
financial institution.
(2)
That includes arrangements for a person to acquire control of the
relevant financial institution only if one or more conditions are met
(such as the happening of an event or doing of an act).
10
(3)
In this section—
“alternative finance arrangements” means the arrangements
referred to in section 71A(1), 72(1) or 72A(1);
“arrangements” includes any agreement, understanding, scheme,
transaction or series of transactions (whether or not legally
15
enforceable);
“connected arrangements” means any arrangements entered into
in connection with the making of the alternative finance
arrangements (including arrangements involving one or more
persons who are not parties to the alternative finance
20
arrangements);
“relevant financial institution” means the financial institution
which enters into the alternative finance arrangements.
(4)
Section 840 of the Taxes Act 1988 applies for the purposes of
determining who has control of the relevant financial institution.”
25
(4)
The amendment made by subsection (3) has effect in relation to alternative
finance arrangements entered into on or after 12 March 2008.
153
Alternative finance arrangements: power to vary Chapter 5 of Part 2 of FA
2005
(1)
Section 98 of FA 2006 (alternative finance arrangements: variation of Chapter 5
30
of Part 2 of FA 2005 by order) is amended as follows.
(2)
For the heading substitute “Orders amending Chapter 5 of Part 2 of FA 2005”.
(3)
For subsection (1) substitute—
“(1)
The Treasury may by order amend Chapter 5 of Part 2 of FA 2005
(alternative finance arrangements).
35
(1A)
The amendments that may be made by an order under subsection (1)
include—
(a)
the variation of provision already included in Chapter 5, and
(b)
the introduction into Chapter 5 of new provision relating to
alternative finance arrangements.”
40
(4)
For subsection (3) substitute—
“(3)
An order under this section shall be made by statutory instrument.
(4)
If a statutory instrument containing an order under this section—