Mr.
Browne: Amendments Nos. 192 and 193 come as a joint
package. Both have the intention of ensuring that the individual
taxpayer is notified by HMRC and that a general release by HMRC is not
sufficient. If I may slightly expand, the belief that underlies both
amendments is that exemptions and conditions provided for should be
addressed to the individual taxpayer to whom they apply. That would
prevent HMRC from being allowed to use any written form available, for
example even a press release, to create limitations on the discharge of
duty.
The
amendments would also require the conditions and exemptions to be
received by the taxpayer. As the legislation currently stands, HMRC is
only obliged literally to write them down. If a taxpayer is required to
follow the rules, the view of our party is that HMRC should ensure that
the taxpayer first be provided with the rules and regulations that they
are required to comply with.
The
Chairman: Ideally succinct. I thank the hon.
Gentleman.
Mr.
Gauke: Essentially, amendment No. 295 does what amendments
Nos. 192 and 193 jointly do. The arguments have been expressed by the
hon. Member for Taunton. The Institute of Chartered Accountants noted,
with regard to paragraph 3 of schedule 37, that it seems to give HMRC
wide-ranging powers to create a statutory condition by means of, for
example, a press release. Again, that raises an issue not only of
accountability but of practicality: not every taxpayer——I
dare say not even every professional adviser——will be
watching every HMRC press release as closely as possible. In the
circumstances, it would be preferable if this power was used
specifically for specific taxpayers rather than applying generally.
Therefore, we are most sympathetic to the Liberal Democrats’
amendments and we seek the Government’s views on our amendment
No.
295.
Jane
Kennedy: This draft of the legislation aligns the rules in
this area. It does away with the need for prior approval for VAT, but
that is balanced by the power to set conditions about what is
acceptable. I have heard what has been said about press releases and
will deal with that directly. However, the only conditions that HMRC
expects to specify by this route are the current high-level ones, which
allow preservation of records by any method as long as it captures all
the information needed for a tax return. The information needs to be
available in a legible
form. It
is important that I take the opportunity to put on record that these
conditions will not be in a press release. A press release is a
temporary format. It is very important that the conditions be
highlighted in a public notice, and these conditions are fundamental.
It is quite right that they need to be publicised to all taxpayers. If
these amendments were made, HMRC could not put the conditions in a
notice. Instead, it would have to write to each individual taxpayer to
set them out. Hon. Members will agree that that would be hugely
resource-intensive and help no one. Therefore, although I acknowledge
that there is a genuine worry behind the amendments, I hope that I have
been able to address that concern in my response and that the
amendments will not be pressed to a Division at this late
stage.
Mr.
Browne: The Minister has gone some way to addressing those
points and I hope that she will continue to be vigilant in the way that
she instructs both her Department and HMRC on the need to ensure that
those who are required to comply with the law know what the law is that
they are being required to comply with.
On that
basis and in the spirit of the mood of the Committee, I beg to ask
leave to withdraw the amendment.
Amendment,
by leave,
withdrawn. Schedule
37 agreed
to.
Clause
111Disclosure
of tax avoidance
schemes Question
proposed, That the clause stand part of the
Bill.
Mr.
Gauke: I shall be brief, as I have some comments to make
on the amendment in my name in relation to schedule 38. Clause 111
relates to the disclosure of tax avoidance schemes, and the point has
been made that subsection (2) contains provisions on when the measures
will come into force. We have received representations that there
should at least be a reasonable time between the making of the final
regulations and their coming into effect. Will the Minister give the
Committee some guidance as to what she anticipates the timetable will
be?
Jane
Kennedy: The regulation-making powers that the
commencement order provides for would be made immediately after the
passing of the Bill. The Committee has before it a draft of the
regulations that are intended to be made, but the substantive
provisions of the schedule
will be brought in at a later date. As is normal practice, they would be
brought in immediately on Royal
Assent. Question
put and agreed
to. Clause
111 ordered to stand part of the
Bill.
Schedule
38Disclosure
of tax avoidance
schemes Amendment
made: No. 235, in schedule 38, page 381, line 45, leave out
‘involving the client’.—[Jane
Kennedy.]
The
Chairman: I thank the Committee for its co-operation and
look forward to seeing Committee members on Thursday
morning. Further
consideration adjourned.—[Mr.
Blizzard.] Adjourned
accordingly at twenty-eight minutes past Seven o’clock till
Thursday 12 June at Nine
o’clock.
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