New Clause 2 - Shares in employee-controlled companies and unconnected companies

Part of Finance Bill – in a Public Bill Committee at 10:30 am on 24 June 2004.

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Photo of David Laws David Laws Shadow Chief Secretary to the Treasury 10:30, 24 June 2004

I resent the Paymaster General's tone. We are talking about the 10 years ago since I left the City of London, time during which she has been serving in Finance Bill Committees. My point was designed to be helpful to the Treasury.

For a prolonged period, under Conservative and Labour Governments, the Treasury has consistently failed to close such loopholes. It has failed for two reasons. First, it has been consistently unimaginative in introducing legislation to anticipate loopholes. Instead, the loopholes have to be closed afterwards. The proposal that was eventually introduced to extend employers' national insurance contributions to all benefits in kind is a model of that type. Secondly, the Paymaster General has not recognised the fact that if the Government continue to introduce tax breaks that allow innovative individuals in the tax avoidance industry to exploit such loopholes, we shall no doubt return to the same debate year after year.