Schedule 12
Finance Bill
11:15 am
Philip Hammond (Shadow Chief Secretary To the Treasury, Treasury; Runnymede and Weybridge, Conservative)
It is a pleasure, Mr. Hood, to serve under your chairmanship for the first time on this Bill. The Minister has made the case for closing a gap that has opened up. We do not dissent from her view, but there is a concern here. The Minister indicated that some funds had already moved location to exploit what would have become a loophole. Clearly, their premature action has allowed the Government to intervene and amend the Bill during its passage through Parliament to close a loophole.
It is rather disconcerting that, with the vast resources that the Government have available, an avoidance opportunity of this nature was not spotted when the schedule was drafted. The Minister told us that substantial amounts of Exchequer revenue could be at stake. Presumably, if those seeking to exploit this loophole had been able to contain themselves for just another two months and not shown their hand until after the Bill had received its Third Reading, the Exchequer would indeed have suffered that loss of revenue as those avoidance opportunities were exploited and presumably then reversed in next year’s Finance Bill.
Can the Minister tell us, because it is not always clear how this works in government, what lessons the Government have learnt from this and what analysis of this problem has taken place within the Treasury? How are the Government moving to ensure that other such loopholes are not being opened up unintentionally in areas where the potential exploiters will not be so accommodating as to show their hand at a time when the Government are still in a position to deal with it?