Clause 52
Finance Bill
1:15 pm
Jeremy Browne (Taunton, Liberal Democrat)
I beg to move amendment 177, in clause 52, page 24, line 13, leave out ‘£100’ and insert ‘£500’.
You will recall, Mr. Hood, that we had an extremely lengthy debate on all these matters a year ago, and that I had the opportunity to raise every issue I could conceivably think of—and many that I had not previously thought about—with regard to the topic. I do not intend to go over all that ground again, especially as it has been touched on in our discussions on schedule 27, but I have tabled this specific amendment. Yet again, I cannot claim its original authorship, because representations were made to me by the Chartered Institute of Taxation’s Low Incomes Tax Reform Group on that specific point, so it seemed reasonable to raise the issue and have a short discussion on it.
You will recall, Mr. Hood, that a year ago, we touched on the fact that non-doms are always portrayed in the media as extremely wealthy, but of course there are some who are not wealthy. Just before we broke for lunch, the point was made that fruit pickers from Poland, for example, or people doing jobs that pay only the minimum wage or a small amount above it would nevertheless be classified as non-doms. The amendment concerns the tax they would be eligible to pay on interest on money in their bank accounts. Because of sterling’s decline against the euro, people who live elsewhere in Europe, or who are paid in euros, might be able to accumulate even more money than normal. Anyone working hard and applying themselves, even if earning a relatively small amount of money, could build up a reasonable balance without it being regarded as large by any normal person’s standards, and they would be eligible to pay interest on that balance. The point was well made by the hon. Member for Fareham that that might be seen as unreasonable, although that is a subjective view.
The other point that the hon. Gentleman made was about practicalities: for someone eligible to pay £20 of tax on a balance of £100, in terms of additional interest, it seems to be quite an administrative burden to recoup a rather small amount of money. The amendment therefore proposes that the clause should specify £500 for interest payments, rather than £100, which would give people just a little more of a cushion, with regard both to practicality and to giving people an opportunity to save a small but reasonable amount of money. That would be more workable and reasonable.