Clause 34 - Annual exempt amount

Part of Finance Bill – in a Public Bill Committee at 9:15 am on 14th June 2012.

Alert me about debates like this

Photo of Catherine McKinnell Catherine McKinnell Shadow Minister (Education) 9:15 am, 14th June 2012

I thank the Minister for his comments in response to the contributions of hon. Members this morning, and he has provided an element of clarity for some of those specific queries. However, I noted the weariness with which he referred to yet another request for a report to be laid in the House of Commons Library. Once again, that raises some concerns about the level of transparency around these Government tax reforms. We have discussed the fiscal drag that will result from the uprating, the freezing and the change from RPI to CPI, and there is an element of stealth in that taxation that the public have a right to understand. While it may not be hidden in the small print, it is not necessarily evident at this stage exactly how many people will be affected. The Minister gave a rough estimate of 60,000 additional people falling within the capital gains assessment system. However, the figures given this morning do not give absolute clarity, and neither do they give clarity on the cost implications for HMRC.

We accept that we face a serious issue with the economy in the current economic climate, but one of the biggest challenges is demand in the economy. Therefore, any increase in the uprating of the personal allowance, which has been discussed this morning, has unfortunately been completely undermined by the removal of tax credit support for working families and by the increase in VAT, which has taken money out of people’s pockets and demand out of the economy. For that reason, there needs to be transparency on the impact of these tax changes on households and personal incomes, and I urge hon. Members to support the amendment.