What is likely to happen? It may be that growth in tax revenues as the economy picks up will, to some extent, come to the rescue of a future Chancellor, or it may be that a future Chancellor will contemplate a modest deficit if the debt burden is falling as a share of GDP and if the economy is continuing to grow. In any case, I am sure that all noble Lords will accept that if we are forced by then to accept a drastically smaller state, a proper debate will need to take place.
9.27 pm
Lord Wakeham (Con): My Lords, this has been an extremely wide-ranging debate. Perhaps the Minister might like to take some comfort if I tell him that I support the Finance Bill that he has brought before the House and that I would like to see it passed. That would be an encouragement to him. I add my congratulations to my noble friend who has just finished his time as chairman of the Economic Affairs Select Committee. In fact, not many of us have been chairman of that committee because when it was set up the noble Lord, Lord Peston, was chairman. He was extremely good and when his term of office came to an end we changed the rules so that he could do another session as chairman. He might even have done a third term. He certainly did it for a very long time and was extremely good, so when I followed him as chairman some years ago, it was a bit of a revelation to have someone without the deep knowledge that he has. Certainly, my noble friend Lord MacGregor has tackled a number of very important issues very well. I remember my time particularly because the committee produced, as my noble friend Lord Lawson will remember, the first serious report on the economics of climate change. It was a unanimous report. As he was a very prominent member of the committee, we had a job to educate one or two members of some of the finer points but we got it through.
The Government need credit for their improved consultation but our report indicates that it is still not good enough. They are still not as good as I would like to see them in their consultation. Certainly, when plans change, they do not consult about the new plans. We are very impressed with the people who give us evidence. But I sometimes wonder whether, in practice, some of them know what they are saying or whether they are taking from their own members what they tell them to say. The noble Lord wanted experts in tax to come and tell us how to collect more tax, but I want these advisers to be very practical about telling us the unintended consequences of what the Government are doing. That is what I think these advisers are best at, or ought to be best at.
While the Government have made progress in all sorts of areas, the truth of the matter is that virtually every one of our taxes in this country will need some very serious looking at over the next few years—not necessarily to reduce the tax rates; that is not what concerns me. Virtually every tax has anomalies and difficulties. For example, with income tax, if you earn between £100,000 and £120,000 a year, your effective rate of tax is 60%, because as the personal allowances fall and you go up to the 45% rate, you end up paying 60% on your income. That is complete nonsense and it should not be so. The Government know this perfectly well and they should change it.
I will not go far into corporation tax because my noble friend Lord Lawson made a scathing attack on its inadequacies. However, if the Government think that they will get international agreement to deal with the problems of Starbucks and other such companies by negotiating on corporation tax in a wider world, they should forget it; that is not going to be the way. Corporation tax has passed its sell-by date as far as international business is concerned. We have to find some other way.
In the past I have talked about capital gains tax. Somebody in the Labour Party made a speech the other day to say that a rate of capital gains tax for long-term holders of investments should be considered. If that is not recognition that a substantial part of the capital gains tax that people pay is a tax on inflation, I do not know what is. Capital gains tax is very substantially —not completely, of course—a tax on inflation, and sooner or later we will have to face that.
I have had a go before in the House about stamp duty. It is fundamentally a bad tax. It is a tax on change. What we need in the country and in the world is for things to change and to improve. Of course, the Inland Revenue loves stamp duty because it is an easy tax to collect, but it is fundamentally a bad tax. The economic effects are being felt now. Things that would happen are not happening because stamp duty is too high. Lastly, I turn to inheritance tax. The Prime Minister has said in a speech that he thinks it needs to be looked at. Right across the board, you can see things that need to be done to bring our tax system up to proper modern standards.
The Minister quoted from a report about the greatly improved way in which tax policy is being achieved, but the formal review that was promised has not actually happened. I hope that it will happen. I am not
saying that there are not some good things in what has been done, but I am not sure that it is as good as it might be. If the Government come to do their formal review, I would invite the people to look at one particular paragraph in our report. It is a quotation from the senior tax partner in a firm that I used to work for. I suspect that I left the firm long before he was born, so I do not know him, but he is very good. He is referring to the division of expertise between the Treasury and HMRC and whether that is right—whether the Treasury has sufficient experts. He says,
“if HMRC’s role was to ‘own’ the policies, ensuring that any proposals are rigorously evaluated by both the policy lead and those with practical experience of the operation of the tax system, then a number of the concerns of detail might be identified and addressed up front. HM Treasury would then have a clearer ‘scrutiny’ role, which would provide the ‘challenge function’ to the policies being developed”.
That is the way that policy arrangements between the Treasury and HMRC should develop rather than as it is at the moment, where there seems to be a division of expertise between the two. I am not sure it is as good as it might be. But I finish by saying that I am in favour of the Bill that the Minister has brought before the House.
9.35 pm
Lord Flight (Con): My Lords, I first make the rather obvious point that the relative brevity of this important debate and the thinness of the Chamber reflect the lack of power of this House to amend Finance Bills. It strikes me that now that this House is essentially an appointed and not a hereditary House, that is out of date. Much though I pay credit to the noble Lord, Lord MacGregor, and his committee, it is time for the issue of this House being able properly to consider financial legislation in the same way as the other place to be looked at.
I pay my own credit to the term of office of the noble Lord, Lord MacGregor, and the excellent work that his committee has done. His committee is right in its recommendations with regard to delaying the new measures for LLPs. I agreed with everything that my noble friend Lord Lawson and the noble Lord, Lord Wakeham, had to say. With regard to the issue of the personal conduct of bankers, I was recently rereading Professor Plumb’s biography of Walpole and noted that at the time of the South Sea bubble all those involved, including the Prime Minister of the day, were promptly clapped up in the Tower and had all their estates removed. They were let out in due course, but our forebears seemed rather more effective at disciplining people who had acted improperly than we are today.
There are obviously good things in the Finance Bill, and it has been a popular Bill. In particular, I like the improved export credit finance arrangements. Many of our small and medium-sized companies have found it increasingly difficult to get export finance. I also like the transferable tax allowance and the tax allowance for fracking development. But the most radical measures have been the anti-tax avoidance measures and I want to say a little about those.
First, I find it rather sad that even in this House the language of this territory has become rather muddled and, dare I say, misleading. Let us be clear: you start
off with evasion, which is criminal. That is simply breaking the law and not paying the tax that you should pay. Then there is avoidance. By definition, avoidance is within the law. If it were not, it would be evasion and without the law. But within avoidance there is a hierarchy. There are all sorts of government tax incentives such as ISAs, EIS, pension saving and the very tax incentives that are in this Finance Bill, which everyone would say were fine. They are actually there to avoid tax. The other side of the coin is that they constitute tax avoidance. I am sure that there are very few Members of this House who have not invested in ISAs or benefited from the tax incentives of pension savings. Everyone is a tax avoider in that sense.
Then we have what have been essentially government schemes, but which have been poorly drafted and have then been exploited and abused where fundamentally the issue is that the original law needs tightening up. Then, at the bottom of the heap, are what I view as unacceptable schemes—fabrications. Tax is wholly justified on those. It has always been my view that I knew one when I saw one and always felt that it was unwise for anyone to consider using one of those.
However, the measures in this Bill do not apply just to the latter—as I think the noble Lord, Lord Deighton, implied. They also apply to statutory government schemes brought in by the previous Government, where the law is somewhat unclear—in part because they were legislated in a hurry—and where there are disagreements between lawyers and HMRC, often as to what is within and without the measures that were enacted.
There is a better solution—and here I declare an interest as chair of the EIS Association. There were criticisms that EIS was at one stage subject to abuse, and the industry sat down with HMRC and went through what HMRC thought and what the industry thought. It ended up with a win-win solution whereby in future all EIS issues are subject to pre-clearance. That means that those raising the money, and the companies, know where they stand, the Revenue knows where it stands, and the whole issue is satisfactorily cleansed of criticism. This Finance Bill introduces a retrospective requirement, where the Revenue considers that a scheme has been abused, for the full amount of tax being saved to be deposited. This applies to three areas of government statutory incentives in particular: to film and sale schemes, known as Sections 42 and 48; to enterprise zones; and, where I think there is most injustice, to the Business Premises Renovation Allowance —BPRA—scheme. I might add that I have no investment in any of these areas and no direct first-hand knowledge, but a lot of perfectly responsible people have brought concerns to me, and they have been raised with the Treasury.
I start by saying that if the Treasury and HMRC considered that some schemes did not meet the statutory requirements, they should probably have disallowed them at the outset. Instead, for years things have been waiting to be sorted out and have not been addressed one way or the other.
My next point is that many people registered under the so-called DOTAS—Disclosure of Tax Avoidance Scheme—rules before there was any obligation to do so. They registered with an intention to be transparent.
Ironically, it now ends up with those registering being punished and those not registering not being punished. It is a very strange anomaly in the approach that has been taken. What is happening is that HMRC is demanding money when they cannot necessarily show that the relevant investors have done something wrong.
The proposed legislation which authorises HMRC to remove funds from individuals’ bank accounts goes even further towards a somewhat overbearing state. It is such a complicated and difficult area that very few people actually know what is in the Finance Bill in this regard. However, the Treasury Select Committee and the Chartered Institute of Taxation have complained about unprecedented HMRC executive powers of decision, and of HMRC being put in the position of judge and jury, and they have complained that it creates a precedent in the UK tax system whereby the tax authorities are given power to demand payment without any right of appeal. The Treasury Select Committee also objected to the retrospective nature of the requirement for taxpayers to pay 100% up front within 90 days—potentially applying, I think, to some 65,000 cases. This puts fiscal policy on a slippery slope towards arbitrary taxation. Many individuals have been good-faith, legitimate BPRA investors over several years with no complaints from HMRC. They now find themselves on the wrong side, with notices to pay.
Moreover, the current position seems immediately to be shambolic, in that although HMRC has published an extensive list of all those to whom those arrangements are to apply, at the same time it appears to be saying—if anyone can get through to it on the telephone—that, no, they will not apply until negotiations have been completed.
There is an important issue, which is that there may be some situations, particularly with the BPRA, where most of the schemes are completely in compliance with the law but some are deemed not to be by HMRC, so a modest and partial amount of tax may have to be recovered. I am advised—I do not know whether it is true—that HMRC did not take full external legal advice on the measures before the Finance Bill was produced and that there is a significant possibility of judicial reviews where the courts will find against HMRC.
Finally, the accelerated payments rules are contrary to two fundamental legal principles. First, I believe that in this country we are always innocent until proven guilty; whereas what is happening here is that the standard basis of self-assessment is being overridden and taxpayers are being treated as guilty until they can prove their innocence. Secondly, there is no proper appeal mechanism. As I have already said, HMRC is judge and jury in these matters. Extraordinarily to my mind, two of the schemes are—I repeat—government, statutory schemes, state-aid approved and brought in under the previous Government.
The Treasury and HMRC have been unwilling to listen to the concerns of many people. I exhort the Treasury and HMRC to be extremely careful how they use the new powers; to endeavour to use them justly; and that HMRC itself is wholly transparent in the use of those powers.
9.46 pm
Lord Davies of Oldham (Lab): My Lords, this has been a wide-ranging debate. I wish the noble Lord, Lord Flight, well in his campaign to wrest control of supply from the other place; he has to reverse more than a century of history and quite significant political obstacles before he achieves that objective.
We have had very interesting contributions. Of course, I particularly enjoyed that from the noble Lord, Lord Lawson. I appreciated him as a historian when he indicated to us that spads going on to become prominent parliamentarians is by no means a new phenomenon but went back more than half a century. As I shall show in a moment, he is also pretty good as a forecaster, because I shall be critical about the Budget. He is right on both counts.
First, I pay tribute to the noble Lord, Lord MacGregor, who introduced his report on limited liability companies and has played such a significant part in enriching our debates on Finance Bills through the reports of his committee. This was one of the more challenging reports in many ways, because it asked the Government to delay what they had clearly set their mind to do and indicated why consultation ought to be respected more clearly than appeared to be the case by both the Treasury and HMRC. My noble friend Lord Joffe put a particular perspective on that, suggesting that the committee itself could enhance its role in relationship to future Finance Bills by ensuring that it consulted in greater depth and produced reports that established contact with the smaller organisations in the country—even the very smallest. After all, this report was significantly about limited liability partnerships and SMEs. Of course, they are small. I gather that the danger for the committee was that it listened to representative organisations and a little less to those who are active on the ground. I am sure that my noble friend Lord Joffe has a significant point there. However, we all very much respect the work of the noble Lord, Lord MacGregor, and thank him for his contributions over the years. We know that he will still contribute significantly to our deliberations, even when he has retired from the chairmanship.
The noble Lord, Lord Wakeham, also introduced an interesting dimension to the debate. I identified three quite significant taxes which he wanted the Revenue to wipe out in terms of receipts. We are often accused on this side of the House of spending money too easily—quite wrongly, of course—but the noble Lord is in great danger of reducing the receipts of government in a dramatic way. Unless he comes out with some pretty clear proposals for where other tax revenues are going to emerge, I am quite sure that the Government will be giving fairly limited consideration to that at present.
The noble Lord, Lord Razzall, indicated that there will be choices before any Government after 2015. We know those choices to be harsh and challenging but he indicated that some amelioration might occur if the economy grew. My goodness: that is partly to recognise the Opposition’s case that the economy has not grown fast enough over these past few years, hence the level of privation. It is also not likely to grow very fast over the next few years, with the Government hell bent on following the principles which they have up until now.
I want to demonstrate that the Bill does of course show a long overdue growth in our somewhat fragile economy. There clearly is growth in the economy but in 2010, the Chancellor forecast that over this period, the economy would have grown by 9.2%. In fact it has grown by exactly half that, or 4.6%. Is it therefore any wonder that the Chancellor is short of some resources? I might add that if it is suggested that the economy now is doing well compared with other economies, first, it has risen from a very low base and, secondly, the United States and Germany have still both had growth rates over this period which have been far higher than those of the United Kingdom. There is not much to boast about there. It is also the case that the Chancellor is borrowing over this period £190 billion more than was planned and, as the Minister made quite explicit, the Chancellor is going to clear the deficit in 2018 when the proposition in 2010 was that it would be cleared by five years of coalition government. It is a pretty tawdry success that the Government are presenting to the House in this Bill.
Of course, we are all in this together, as has been emphasised on all sides. It is true that the top 1%, in order to be along with the rest and in it together, needed a tax cut which has been worth £3 billion while 7 million people who are at work are in poverty. That is the nature of it. I know that the Government constantly emphasise the employment figures but we are going to examine them more carefully. The nation knows the quality of the jobs that are being created. There are people who define themselves as self-employed, move out of the unemployment category and are living hand to mouth. That is why there is so much concern in the country about the constant use of food banks, and why on all sides there are indications that pressure upon ordinary people is very intense.
What is at the root of this? Quite clearly, it is that wages have continued to fall behind prices, and the Government know this to be so. Even this month, that has been confirmed for the most recent period. So people’s living standards have fallen over these five years. It may be that the Government think that because we now have a recovery—the slowest recovery for 100 years—people’s minds will wipe out the level of deprivation over these past years. They may not be right. If ordinary families are £974 worse off through tax and benefit changes than they were in 2010, these problems are deep.
Is the coalition completely unaware that in the past four years a massive stimulus has been given to the continuing creation of the unfair society, where wages stagnate and the resources devoted to the highest rewarded sections of our society continue to escalate? I know that from time to time it hits the headlines that some shareholders carry out a minor revolt against their chief executive but what continually goes on, day in and day out, is the widening of differentials between the pay of the super-rich—I am including people who work; I mean the chief executives of companies—and the average pay in their companies.
This growing inequality brings, as so much research now indicates, a clear problem of dissatisfaction in society, a sense of unfairness that may express itself in passive disillusion but may not be reflected at the
ballot box in quite that way. The Government have opted for a low-wage, low-skill economy. That is what we have, with all these people working harder and longer for less, yet the Government pretend that they can congratulate themselves on the employment statistics that they represent. Surely the clearest indication of the Government’s limited success in this area is the decline in productivity and the problem of Britain being able to earn its way. Our balance of payments continually shows an increased deficit.
We are clear that this Budget and Finance Bill should have been based on much fairer principles than have been reflected in them. Hard-pressed families need help with their energy bills, which we have all seen rise rapidly and unfairly. Indeed, although the noble Lord, Lord Lawson, waxed strong on certain issues regarding energy, I do not think that he commented on whether he thought the public had been exploited by private monopolies in the way in which energy bills have gone up in recent years.
We will of course get rid of the dreadful bedroom tax. I am not sure that Members of this House are at all aware of the cost to families of very limited resources who are in real need and the misery that they suffer when they are told that they must give up the one room that they hold for a visitor or another member of the family, to give them some respite, particularly when it is concerned with the disabled, and the bedroom tax forces them into penury or having to move. We think that the ordinary earner also needs a fairer basic rate of taxation, and will attend to that.
Another area where we think there should have been much more emphasis in these past four years is housing stimulus. I understand the Minister’s role with regard to infrastructure and we applaud many of the initiatives taken in that area, but where is the support for the construction industry and the building of houses? Surely that has to be recognised as a priority, otherwise we are faced with a situation where the Government provide a token measure to help people to buy while house price inflation is rampant.
We believe that this Budget is a missed opportunity. The Government could have tried to get the people on their side, and they will pay the cost for not having done so.
10 pm
Lord Deighton: My Lords, the phrase wide-ranging debate is often used in this House, but we can justifiably describe this debate as one of the widest-ranging. It ranged from the broadest macroeconomic issues and challenges to society to the very specific and detailed implications of the taxation of limited liability partnerships. I learnt a lot and I hope that noble Lords did too. Like many of the speakers, I pay tribute to my noble friend Lord MacGregor. I could not do it more eloquently than they have done, or with the same historical experience. It is clear that his contribution is enormously valued. I also thank the other members of the Economic Affairs Sub-Committee.
I shall try to address some of the questions, and given their breadth and technical depth, I am sure that noble Lords will grant me some poetic licence. I shall start with the noble Lord, Lord Davies, who summarised
very well many of the contributions, so I shall not re-summarise them in exactly the same way as he did. As to our competing visions for an economic strategy, I tried very hard to determine the alternative economic strategy that was being offered. As I understood it, the objection to our economic strategy was that the economy has not grown quite fast enough. I do not think that that is an adequate basis for winning the hearts and minds of the British electorate in attempting to get back the keys to drive this particular car. I think that we also heard that one of the explanations for the strength of the recovery was the very low base from which we started. We all know why we had such a low base; I do not really need to revisit that. The work that this Government have done to stabilise the public finances and get the situation under control, so that we can focus on the key drivers of economic growth, is our major accomplishment. My noble friend Lord Lawson reminded me that I should have congratulated my boss the Chancellor of the Exchequer on sticking to his guns. I am not sure how many people would have done the same, given the extreme pressure of those early years of government when the depth of the recession really hit home.
I also have a very different view of the fairness behind this Budget and Finance Bill. The basis of the Bill is very clear. We are doing everything that we can to make this an extraordinarily attractive environment for businesses to grow, to create jobs and to improve their productivity—the very things that create value and drive the economy forward. The concept which I think the noble Lord opposite is not addressing is how you get this economy going. The Government are creating an environment in which businesses are growing and new businesses are starting up. Businesses from around the world want to come here. I have a long queue of investors outside my office every day from all over the world who want to come to this country because they think that it is the best place in the world to invest their capital. That is a result of the environment that this Government are creating.
The noble Lord focused hugely on fairness. This Finance Bill is all about fairness. There is a huge focus on making sure that people pay their taxes, and that focus is inevitably on people right at the top of the income levels. The core income tax measure is the progressive increase of the personal allowance, and there is no fairer way to benefit people at the bottom of the income chain. So what is driving this Budget could not be more focused on those combined goals of making sure that things are done fairly, but also of making sure that we have some growth, so that we have some real proceeds from that growth to distribute across the population.
I take on board some of the suggestions about things that need to be looked at and done better. I certainly agree that responsibility around executive pay is a big issue, and my personal view is that boards need to do their job as effectively as possible. It is certainly right to say that improving productivity will be at the heart of driving forward improvements in real disposable household income, which is what we are all looking for. The OBR tells us that, given what we have done with inflation and growth, we will see
those lines cross this year. It has been a long hard path, but we are getting there. I also agree that a compelling strategy for improving the supply of homes is vital for this country. So although I disagree on many of the core approaches, there are two or three things in there that any new Government should redouble their efforts to attend to.
My noble friend Lord MacGregor asked absolutely the right question about the work of this House on the Finance Bill: does it add value? All I can say is that, having spent the weekend reading the report, and having listened to this debate, I am thinking a lot harder about the real issues and how we can do our job more effectively—whether that is about how the Treasury and HMRC work together, how we train our people, how we consult, or, in particular, how focused we are on improving tax simplification and administration. The quality of the work that my noble friend has overseen makes it easy to answer yes to his question.
I am in a rather strange hypothetical position, because normally when we are discussing such issues we are having a debate after which we could amend things, but I am now defending decisions that have already been taken, so no change will result from this debate. The fundamental difference between us is whether the consultation produced such different results that we needed more time to implement the system. When I looked into this with my officials, we were not in any way persuaded that spending another 12 months working through it would have resulted in a different outcome, and we were extremely keen to ensure that we could put this legislation into practice so that we could collect the money that needed to be paid. Indeed, as I have said before, many of the partnerships that had to change as a result of the measure had already made those changes. It may have been a pragmatic decision, but on balance we feel that we were justified in getting on with this.
The noble Lord, Lord Razzall, made the point about following case law rather than statutory provisions. Again, we felt that in order to administer the rules effectively, we needed the certainty that clear tests apply. The noble Lord, Lord Joffe, made some interesting observations about how much we should invest in HMRC in order to increase the yield. Since 2010 we have invested about another £1 billion in numbers of people and systems to help us collect revenue, so the management approach of evaluating the investment we need to make to enhance the yield is indeed a way in which we think about that challenge.
It is always fascinating to learn about the current perspective of my noble friend Lord Lawson on the economy. I am interested in those things that we can control, and therefore can do something about, but I shall not comment on monetary policy. It is dangerous for a Treasury Minister to do that, given the independence of the Bank of England. It is always good to revisit our discussion on banking reform. I agree that following through those things that the Parliamentary Commission on Banking Standards recommended is absolutely right. In particular, getting SME lending going is a key focus of this Government. On energy policy, to bring my own experience to bear, it is hard to think of another area where I personally spend more time in
trying to think things through and make things work which have real economy implications than energy policy. I will certainly take on board with respect to shale and getting that whole industry moving whether the way the Government are looking at that is sufficiently focused and driven. At the moment, it is managed through the growth implementation committee, which the Chancellor chairs, but it is of course one of a wide number of topics. I have discussed with industry participants how we should follow through on that.
The noble Lord, Lord Razzall, talked about the challenges of keeping our focus on managing the deficit down. I acknowledge the simple point that our work is by no means done. We are still confronted by the same issues around priorities, and the same questions around having the right debate to ensure that we understand the implications of the choices that we will continue to be forced to make.
I agree with a specific point made by my noble friend Lord Wakeham and a number of noble Lords. The best role for advisers is to help us to understand and identify the unintended consequences of the changes and proposals we put in place. That is an extraordinarily valuable role. On rationalising, modernising and simplifying our existing portfolio of taxes, obviously to get the balance right between continuing to meet our tax yield objectives and making them operate more effectively is always something that has to be worked through. Personally, I am a big advocate of the simplest possible portfolio of taxation so that we do not have all the kinds of issues we talked about today—I will move on to address the comments of my noble friend Lord Flight later—which are in the main created by complexity and the perverse incentives you end up with when you fiddle around with a tax regime over many years.
My noble friend Lord Wakeham also referred to the formal review between HMT and HMRC that the committee recommended. I made those comments in my opening remarks, but it is kept continually under review. The independent Tax Professionals Forum also scrutinised the process. The Office of Tax Simplification looked at that and commented positively on how the two worked together. Therefore I do not by any means want to suggest complacency, but that is an ongoing process. I accept absolutely that everything we do could be done better. There is no situation in life where consultation cannot ever be improved. It is like communication—you can never have enough of it. However, we are well seized of the importance of that.
My noble friend Lord Flight, as ever, took on the difficult task of making the case for those who have participated in schemes to manage their tax payments. I admire him for that. He is certainly right that we
need to be careful about the language and that there are tiers of how we should regard just how heinous the abuse or avoidance is. I could not agree more that we do not want to be in a position where we are creating retrospective acts, where we are left with anomalies which make it very hard for people to work out what to do. As regards taking money out of people’s bank accounts, if you look at the process that will be gone through by HMRC before that is done—I will not read out the details—we should take some comfort from that.
My final point on tax avoidance is my own personal view. I have always been a strong advocate in the Chancellor’s ear to pursue these changes quite aggressively. It is important that everyone who could potentially avail themselves of these schemes knows that they are being treated fairly. If you were in a position personally to be able to take advantage of them, you would not want to see other people in an equivalent position, who are prepared to be more aggressive, just paying less tax. There is a real fairness issue here. I think we have got the slant of what we are doing right—a whole regime of competitive taxes where we are rigorous in expecting people to adhere to them and there is no wriggle room for people with a more aggressive frame of mind to play the system. I like the way we are heading, though I know it creates some challenges.
In conclusion, I think we have taken some difficult decisions and resolute action to tackle the enormous debts we inherited. We are all agreed that the job is not done. The whole point of this Bill is to put us back on the right path. We are supporting enterprise, helping families and ensuring everybody pays their fair share of tax. I commend the Bill to the House. I beg to move.
Bill read a second time. Committee negatived. Standing Order 46 having been dispensed with, the Bill was read a third time, and passed.
Draft Finance Bill (EAC Report)
Motion to Take Note
10.16 pm
Moved by Lord MacGregor of Pulham Market
That this House takes note of the Report of the Economic Affairs Committee on The Draft Finance Bill 2014 (2nd Report, Session 2013–14, HL Paper 146).