Clause 125 - Abolition of stamp duty except on instruments relating to stock or marketable securities

Finance Bill – in a Public Bill Committee at 4:45 pm on 10th June 2003.

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Photo of Mr Howard Flight Mr Howard Flight Shadow Chief Secretary to the Treasury 4:45 pm, 10th June 2003

I beg to move amendment No. 63, in

clause 125, page 74, line 31, at end add

'or transactions excluded from stamp duty land tax by Part 3 of Schedule 15 to this Act'.

Photo of Mr John McWilliam Mr John McWilliam Labour, Blaydon

With this it will be convenient to discuss the following:

Amendment No. 64, in

clause 125, page 74, line 34, at end add

'or which is the subject of a transaction excluded from stamp duty land tax by Part 3 of Schedule 15 to this Act'.

Amendment No. 65, in

clause 125, page 75, line 11, leave out from 'instruments' to end of line 13 and insert—

'if they are executed on or after the implementation date for the purpose of stamp duty land tax (see Schedule 19 to this Act).'.

Photo of Mr Howard Flight Mr Howard Flight Shadow Chief Secretary to the Treasury

After the sterling work of my hon. Friend the Member for Hertford and Stortford on this ghastly new tax, I volunteered to finish off the section. The amendments are in part drafting and in part probing amendments. I shall first deal with amendments Nos. 63 and 64. The opening words of clause 125 indicate that henceforth stamp duty will apply only to stock or marketable securities, but that is not the case in schedule 15, which says that some transactions involving partnerships are not covered by the new stamp duty land tax and therefore remain subject to stamp duty. Considering the intent to draft

legislation in a clear manner for readers, it seems that that should be put right. The probing part of the amendments is to ask the Chief Secretary whether we missed other transactions in schedule 15 that still fall under stamp duty and not under the new stamp duty land tax.

Amendment No. 65 is also a probing and a drafting amendment. It is not entirely clear whether it is intended that the qualification of having been

''executed on or after the implementation date for the purposes of stamp duty land tax''

applies to subsections (5)(a) and (b) or, as worded, only to subsection (5)(b).

Photo of Mr Paul Boateng Mr Paul Boateng Chief Secretary, HM Treasury, The Chief Secretary to the Treasury

Amendments Nos. 63 and 64 are unnecessary, as the points have been covered in clause 125(7) and sub-paragraphs 2 and 3 of paragraph 13 of schedule 15. Those provisions have the effect of preserving the stamp duty charge on the partnership transactions that are listed in part 3 of schedule 15.

Preserving the stamp duty charge on the transactions in part 3 is a temporary measure. The intention is to replace part 3 in the Finance Bill 2004 with a stamp duty land charge on those partnership transactions. There will be consultation on the new SDLT proposals, which will commence when the draft clauses are issued in the summer. It is important to recall that the measures that we propose are to be seen in that light. In the light of that explanation, I hope that the Opposition will not press the amendment to a vote.

Amendment No. 65 is of little practical effect. It appears to replace ''purposes'' in clause 125(5)(b) with the word ''purpose'' and omits the final bracket. It is doubtful whether the amendment would make any difference to the sense of the clause. Such a change would not be appropriate. The amendment does not seem to correct any obvious clerical error, and would introduce one because of the missing closing bracket. Although I understand that the hon. Gentleman seeks to probe these matters, I hope that my explanation that we shall return to them during consideration of the Finance Bill 2004 means that he will not press the amendment to a vote.

Photo of Mr Howard Flight Mr Howard Flight Shadow Chief Secretary to the Treasury

It has been useful to get the Government to admit that they propose to extend the new tax to partnerships, which explains the drafting. Perhaps the Chief Secretary could read what I have said about amendment No. 65. It is still not clear whether the qualification of having been executed on or after the implementation date is meant to apply to just paragraph (b) or also to paragraph (a), but with that proviso I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 125 ordered to stand part of the Bill.