Clause 28 - Notices under sections 24 and 26
Finance Bill
5:15 pm
Dawn Primarolo (Paymaster General, HM Treasury; Bristol South, Labour)
That was covered on Second Reading by my hon. Friend the Financial Secretary.
The Revenue will have finite resources. If there is a statutory regime for clearance where even schemes that do not need it, because they are perfectly straightforward and no dispute is involved, go into that system and resources are consumed, the choice is a longer delay or not to do something else in the tax system.
We have sought to give everything that businesses required from this regime and to target it effectively by saying that where they are uncertain and therefore are asking for formal clearance, it is provided.
On the argument relating to the appeals procedure in new clause 2, the hon. Member for Runnymede and Weybridge is quite right: I am bound to say that the appeals mechanism that would be inserted by that new clause is based on a fundamental misunderstanding by those who drafted it for him of the way that notices and self-assessment work. If a company is served a notice and does not think that it is caught by the legislation and has not operated any of the mechanisms that are available to it, it does not have to do anything. The notice does not bring anything into charge. It simply requires a company to take account of the arbitrage legislation when making its self-assessment.
If HMRC disagrees with that self-assessment on the arrangements, it must challenge using the existing self-assessment provisions, which already contain an appeal route to protect the company. I should also point out that new clause 2 would give rise to uncertainty were it be adopted, as it refers to terms not used elsewhere in the arbitrage legislation. In particular, it refers to changes that are ''directed to be made''. As I have mentioned, notices issued by HMRC will not direct that changes must be made. They prompt on the basis of the arbitrage legislation.
New clause 1 is not necessary because all the arrangements that the hon. Gentleman seeks are in place: there is speedy resolution, an appeals procedure in terms of asking for pre-clearance, and a guarantee that the decision from the Revenue is binding. In addition, the appeals procedure is in place in relation to the self-assessment. I ask a simple question: why duplicate? The new clause is not necessary and therefore the Government are not minded to accept it.
Question put and agreed to.
Clause 28, as amended, order to stand part of the Bill.
Clauses 29 and 30 ordered to stand part of the Bill.
Further consideration adjourned.—[Mr. Watson.]
Adjourned accordingly at twenty-nine minutes past Five o'clock till Tuesday 28 June at half-past Ten o'clock.