Clause 3

Part of Finance (No. 2) Bill – in a Public Bill Committee at 12:00 pm on 19 October 2010.

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Photo of David Gauke David Gauke The Exchequer Secretary 12:00, 19 October 2010

First, I will respond briefly to the point about whether there is substantial abuse. It is of course right that we should seek to tighten those matters before there is a significant cost to the taxpayer, and it is in order to ensure that the capital allowances regime works fairly and consistently that we are taking those steps now. The hon. Gentleman asked about the inspection  regime. From the HMRC perspective, any return can potentially be subject to an inquiry, and the definition of trade does not depend on the level of income. It is not, therefore, a question of the point at which one moves from being very small scale and left alone to being a business that is under a different regime as far as the tax authorities are concerned. Any return could be subject to an inquiry.