Schedule 9
Finance Bill
4:30 pm
The Economic Secretary to the Treasury (Ed Balls): Thank you, Mr. Illsley. I am pleased to welcome you back after our morning’s activities. We were discussing schedule 9 and I had explained in extensive detail our approach to the schedule and our targeted anti-avoidance rule. I was talking about the schedule in the context of the extensive consultations that have been going on over the last year on insurance tax matters.
I was explaining at the end of our last sitting that there is a power in the schedule to amend legislation for the start date of the TAAR by regulation, which is a different approach because despite much hard work, neither the Government nor the industry are yet fully satisfied that the legislation will work exactly as we intend, as a number of details remain to be sorted out. The pre-Budget report envisaged that most of the legislation would operate from 1 November 2007, allowing several months between finalisation of the rules and the start date.
However, because more time is needed for this schedule, commencement is now to be determined by an appointed day order, which gives flexibility to allow for several months between finalisation and its coming into effect, whenever the form of the legislation is finalised. Changes to the legislation that are needed to finalise it can be made by regulations, using the power in schedule 9, which means that we do not have to wait until the next Finance Bill or rush to get the final details right on Report. The regulations will be introduced using the affirmative resolution procedure to ensure that there is an opportunity for proper scrutiny in due course.
The legislation, as amended by any regulations, will come into effect from a day to be appointed, which will depend on further consultations, but which we would not expect to be before spring next year. However, we are confident that with further consultation we will be able to get the final details of the schedule sorted out. I commend the proposal to the Committee.