Clause 5 - Taxation
Legislative and Regulatory Reform Bill
10:45 am
David Heath (Shadow Secretary of State for Constitutional Affairs & Shadow Leader of the House, Law Officers (Constitutional Affairs); Somerton and Frome, Liberal Democrat)
I think that the hon. Member for Christchurch (Mr. Chope) has done a valuable job for the Committee in questioning the meaning of “taxation” in the context of the Bill. I have a further two information requests for the Minister.
Many statutory instruments will deal not so much with taxation as with fees and charges, which, if unavoidable, come to the same thing as taxation, particularly local authority fees and charges. If a person is required to buy a plastic bag in which to put their rubbish and the cost of that bag goes up, that is effectively an increase in their tax. For business, that can be a relatively large amount in the context of its turnover. Are we to assume that the word “taxation” includes fees and charges, or not? I suspect that the latter is the case and therefore that the apparent protection there is not as real as it might seem.
The other important point is that there is no provision to prevent an order made on this basis from mitigating any form of credit against tax. In other words, one could reduce a tax credit, which has the effect of increasing tax, but the instrument is silent on that matter. This is a way that the Government very much like to do business: they like to set a tax and then have a variety of complicated measures which reduce the impact of that tax on individuals. Rebates sometimes appear in an election year, for example council tax, and then disappear like the winter snow after the election. That would be an example of a rebate against taxation which it would still be possible to change in the context of the clause in that it does not affect the taxation, but the amount that is given back from tax as a result of an instrument of Government. I should be grateful if the Minister could explain exactly what the scope of the clause is.