Finance Bill

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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 111

Disclosure 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 38

Disclosure 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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