Clause 35

Part of Finance Bill – in a Public Bill Committee at 12:45 pm on 9 June 2009.

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Photo of Stephen Timms Stephen Timms Financial Secretary (HM Treasury) (also in the Department for Business, Innovation and Skills) 12:45, 9 June 2009

Let me just respond to some of the other questions that the hon. Member for Fareham raised, and then I shall gladly give way to his hon. Friend.

The hon. Member for Fareham and a number of other people have made the point that perhaps we could have achieved the constraint that we need in other ways. It is true that there are alternative approaches that can be adopted to address what you might call “debt dumping”, but each would imply compliance burdens on business. Before deciding that the debt cap was the right answer, we looked at other possible approaches and found that each of them presented its own challenges, and we concluded that the debt cap was the best way to proceed. Other countries adopt other approaches, and the hon. Member for Fareham has made the point that the UK is the first country to adopt an arrangement of this kind, which is probably true. However, if we look at the way such matters are handled in the US, our arrangement is much more straightforward and its attractiveness may well become apparent to other jurisdictions.

The hon. Gentleman asked whether the gap in the commencement date between 1 July and 1 January would be used for further consultation. After much consultation, we believe that the rules being introduced are appropriate. It is, of course, true that we can use the period between now and 1 January to listen to any remaining concerns, although I think that all the material issues have been addressed. If there are any other issues, people have the opportunity to raise them.