Finance Bill – in the House of Commons at 7:15 pm on 3 March 2025.
Votes in this debate
Amendments made: 56, page 268, line 19, leave out
“at all times on and after
and insert “immediately before”.
This amendment relaxes the test for determining whether the exemption for existing excluded property trusts in new section 53(4A) of the Inheritance Tax Act 1984 applies. It provides that the property only needs to be invested offshore (or in an AUT or OEIC) immediately before the person’s interest comes to an end (as opposed to at all times after
Amendment 57, page 269, line 1, leave out
“at all times on and after
and insert “immediately”.
This amendment relaxes the test for determining whether the exemption for existing excluded property trusts in new section 54(2C) of the Inheritance Tax Act 1984 applies. It provides that the property only needs to be invested offshore (or in an AUT or OEIC) immediately before the person’s death (as opposed to at all times after
Amendment 58, page 275, line 4, at end insert—
“267ZF Double taxation conventions operating by reference to deemed domicile
(1) This section applies to a case in which the application of any arrangements having effect under section 158 (double taxation conventions) depends (to any extent) on whether a person is treated as domiciled in the United Kingdom for the purposes of inheritance tax.
(2) The person is treated as domiciled in the United Kingdom for the purposes of inheritance tax if they are a long-term UK resident.
(3) Sections 276ZC to 267ZE (persons treated as long-term resident by virtue of election) are to be disregarded in applying this section in relation to any arrangements that are specified in an Order in Council made under section 158 of IHTA 1984 before
(4) Nothing in this section affects the interpretation of any such arrangements as are mentioned in section 158(6) (certain pre-1975 arrangements).”
This amendment provides that, where existing double taxation arrangements operate by reference to whether the UK treats a person as domiciled in the UK for the purposes of inheritance tax, the person is treated as so domiciled if they are a long-term UK resident. It does not affect pre-1975 arrangements and, in relation to pre-2013 arrangements, provides for certain elections to be disregarded.
Amendment 59, page 276, line 13, leave out “gift” and insert
“disposal and remained settled property at all times after the disposal and before the relevant time”.
This amendment clarifies the exemption from the gifts with reservation rules for existing excluded property trusts. It ensures that the exemption only applies where the property has remained in the trust throughout.
Amendment 60, page 276, line 17, leave out
“at all times on and after
and insert “immediately”.
This amendment relaxes the test for determining whether the exemption from the gifts with reservation rules for existing excluded property trusts applies. It provides that the property only needs to be invested offshore (or in an AUT or OEIC) immediately before the relevant time (as opposed to at all times after
Amendment 61, page 276, line 29, at end insert—
“(7C) In subsection (7A)(c), “for the purposes of the 1984 Act” includes for the purposes only of Chapter 3 of Part 3 of that Act (ten-year anniversary charges etc) because of the operation of section 81 of that Act (property moving between settlements).”
This amendment ensures that the exemption from the gifts with reservation rules for existing excluded property trusts applies to property which was excluded property only under the relevant property rules in the Inheritance Tax Act 1984, because it was treated as comprised in a different settlement from that in which it was in fact comprised.
Amendment 62, page 279, line 22, leave out
“not been resident in the United Kingdom for any tax year”
and insert
“been resident in the United Kingdom for no tax year”.
This amendment is minor and technical and clarifies an ambiguity.
Amendment 63, page 279, line 26, leave out
“not resident in the United Kingdom for any”
and insert
“resident in the United Kingdom for none”.
This amendment is minor and technical and clarifies an ambiguity.
Amendment 64, page 279, line 28, leave out
“not resident in the United Kingdom for more than 14”
and insert
“resident in the United Kingdom for fewer than 15”.
This amendment is minor and technical and clarifies an ambiguity.
Amendment 65, page 280, line 12, leave out paragraph (b).
This amendment is consequential on Amendment 58.
Amendment 66, page 280, line 19, leave out sub-paragraph (3).—(James Murray.)
This amendment is consequential on Amendment 58.
Third Reading
James Murray
The Exchequer Secretary
8:12,
3 March 2025
I beg to move, That the Bill be now read the Third time.
At the autumn Budget, my right hon. Friend the Chancellor laid the essential foundations for boosting investment and growth to put more money in people’s pockets, the No. 1 mission of the Government under the Prime Minister’s plan for change. The Budget was built on robust fiscal rules, rules that put a stop to day-to-day spending being funded through borrowing and to get net financial debt falling as a share of GDP.
The Finance Bill delivers on our manifesto commitments by removing the outdated concept of domicile status from the tax system, increasing the capital gains tax rate for carried interest, increasing the higher rates of stamp duty for additional dwellings, introducing the 20% standard rate of VAT on private school fees, and changing the energy profits levy by extending the period over which it applies and adjusting its rate by 3 percentage points.
As we know, my right hon. Friend the Chancellor set out at Budget how the fiscal inheritance was far worse than we had expected. The Opposition, when in government, let public spending plans become unsustainable. They did not share this with the OBR or the British people. It fell to us to fix that mess when we took office. That is why we had to make an increase to capital gains tax, changes to inheritance tax thresholds and a plan to close the tax gap by a record package of £6.5 billion of additional tax revenue by the end of the Parliament.
I thank right hon. and hon. Members from across the House for their often helpful and insightful contributions to the debates during the Bill’s passage. I would like to thank officials at the Treasury and in Parliament for their work on the policies and the legislation that have led to the Bill whose consideration we are now concluding. The Bill plays a key role in delivering economic stability, repairing the public finances and laying the essential foundations for growth. It is through that growth that we will put more money into the pockets of people across Britain, and I commend it to the House.
James Wild
Shadow Exchequer Secretary (Treasury), Opposition Whip (Commons)
8:14,
3 March 2025
I join the Minister in thanking hon. Members on both sides of the House who participated in the debates we have had so far on the Bill, which I do not intend to extend unduly. I join him in thanking the parliamentary staff and the hon. Members who chaired the Committee.
The driving mission of the Government, according to the Prime Minister, is growth, but despite inheriting the fastest growing economy in the G7, he and the Chancellor chose to talk down our economy. The impact of their words was to weaken confidence. Then, in the October Budget, the Government made choices and put in place a raft of measures in this and other Bills that have stopped growth stone dead: £40 billion a year of extra taxes; higher national insurance; increasing tax on investors; deterring the risk takers and the wealth creators we need; pushing up inflation; and hitting working people and pensioners.
In just the last two days, senior business leaders from the retail and hospitality sectors have warned about the damage the Budget and Labour’s costly employment Laws will have. They are just the latest businesses sounding the alarm, but the Chancellor is not listening. For all the talk of growth, we can already see from their actions that we have a Government committed to higher taxes, higher spending, more borrowing and more regulation—the classic Labour approach. It does not work. The Government need to change course, otherwise we will all pay the price. That is why we will not be supporting the Bill this evening.
Question put, That the Bill be now read the Third time.
Division number 112
Finance Bill: Third Reading
As a bill passes through Parliament, MPs and peers may suggest amendments - or changes - which they believe will improve the quality of the legislation.
Many hundreds of amendments are proposed by members to major bills as they pass through committee stage, report stage and third reading in both Houses of Parliament.
In the end only a handful of amendments will be incorporated into any bill.
The Speaker - or the chairman in the case of standing committees - has the power to select which amendments should be debated.
The Chancellor - also known as "Chancellor of the Exchequer" is responsible as a Minister for the treasury, and for the country's economy. For Example, the Chancellor set taxes and tax rates. The Chancellor is the only MP allowed to drink Alcohol in the House of Commons; s/he is permitted an alcoholic drink while delivering the budget.
The Opposition are the political parties in the House of Commons other than the largest or Government party. They are called the Opposition because they sit on the benches opposite the Government in the House of Commons Chamber. The largest of the Opposition parties is known as Her Majesty's Opposition. The role of the Official Opposition is to question and scrutinise the work of Government. The Opposition often votes against the Government. In a sense the Official Opposition is the "Government in waiting".
A proposal for new legislation that is debated by Parliament.
Ministers make up the Government and almost all are members of the House of Lords or the House of Commons. There are three main types of Minister. Departmental Ministers are in charge of Government Departments. The Government is divided into different Departments which have responsibilities for different areas. For example the Treasury is in charge of Government spending. Departmental Ministers in the Cabinet are generally called 'Secretary of State' but some have special titles such as Chancellor of the Exchequer. Ministers of State and Junior Ministers assist the ministers in charge of the department. They normally have responsibility for a particular area within the department and are sometimes given a title that reflects this - for example Minister of Transport.
Laws are the rules by which a country is governed. Britain has a long history of law making and the laws of this country can be divided into three types:- 1) Statute Laws are the laws that have been made by Parliament. 2) Case Law is law that has been established from cases tried in the courts - the laws arise from test cases. The result of the test case creates a precedent on which future cases are judged. 3) Common Law is a part of English Law, which has not come from Parliament. It consists of rules of law which have developed from customs or judgements made in courts over hundreds of years. For example until 1861 Parliament had never passed a law saying that murder was an offence. From the earliest times courts had judged that murder was a crime so there was no need to make a law.
A person involved in the counting of votes. Derived from the word 'tallier', meaning one who kept a tally.
The House of Commons votes by dividing. Those voting Aye (yes) to any proposition walk through the division lobby to the right of the Speaker and those voting no through the lobby to the left. In each of the lobbies there are desks occupied by Clerks who tick Members' names off division lists as they pass through. Then at the exit doors the Members are counted by two Members acting as tellers. The Speaker calls for a vote by announcing "Clear the Lobbies". In the House of Lords "Clear the Bar" is called. Division Bells ring throughout the building and the police direct all Strangers to leave the vicinity of the Members’ Lobby. They also walk through the public rooms of the House shouting "division". MPs have eight minutes to get to the Division Lobby before the doors are closed. Members make their way to the Chamber, where Whips are on hand to remind the uncertain which way, if any, their party is voting. Meanwhile the Clerks who will take the names of those voting have taken their place at the high tables with the alphabetical lists of MPs' names on which ticks are made to record the vote. When the tellers are ready the counting process begins - the recording of names by the Clerk and the counting of heads by the tellers. When both lobbies have been counted and the figures entered on a card this is given to the Speaker who reads the figures and announces "So the Ayes [or Noes] have it". In the House of Lords the process is the same except that the Lobbies are called the Contents Lobby and the Not Contents Lobby. Unlike many other legislatures, the House of Commons and the House of Lords have not adopted a mechanical or electronic means of voting. This was considered in 1998 but rejected. Divisions rarely take less than ten minutes and those where most Members are voting usually take about fifteen. Further information can be obtained from factsheet P9 at the UK Parliament site.
