Schedule 7 - Accounting practice and related matters
Finance Bill
5:15 pm
Susan Kramer (Shadow Minister, Treasury; Richmond Park, Liberal Democrat)
The hon. Gentleman makes my point. If he reads the 2000 Act, he will see that it says that that shall not apply. In other words, the various constraints that would require rent factoring to be treated as income rather than as a capital gain specifically do not apply to any financial transaction of more than 15 years under the 2000 Act. Anybody looking for the current law after that Act came into effect would have read that section and behaved accordingly. Under those circumstances we will go round in circles. We are all getting exhausted. So why do not I just carry on and finish making a relatively brief point?
For companies that entered into transactions reliant on the 2000 Act, the lump sum or compensation that they received in exchange for the sale of future rents would have been based on the various tax protections and opportunities available to them in the relevant paragraph. Therefore to say that for the future, remaining years of the life of that transaction the sum has to be treated differently is a significant financial penalty. If that had been a devious reading of the various sections, one could understand it, but when it was a straightforward reading the measure is not justified.