Clause 172 - Gains on policies of life insurance etc: rate of tax
Finance Bill
9:15 am
Mr John Healey (Economic Secretary, HM Treasury; Wentworth, Labour)
I believe that the hon. Member for Billericay (Mr. Baron) is a little ahead of himself. That is precisely the debate that we will have when we come to the amendment to the schedule. It will be appropriate to deal with those points then.
The clause will not take effect until next April. That is simpler for taxpayers, who will not have to deal with two rules for the same year, saves insurers from having to make administrative changes overnight and increases the value of the tax cut. Policyholder funds will be boosted at once by the reduction in insurers' tax bills, but no extra income tax will actually be payable until January 2006—in more than two and a half years' time—when income tax for the year of assessment 2004–05 is due. On that basis, I commend the clause to the Committee.
Question put and agreed to.
Clause 172 ordered to stand part of the Bill.