Finance (No. 3) Bill

Robert Jenrick Excerpts

2nd reading: House of Commons & Programme motion: House of Commons
Monday 12th November 2018 Commons Chamber

[The Exchequer Secretary to the Treasury (Robert Jenrick)]

I thank all right hon. and hon. Members across the House who have contributed to this wide-ranging debate. The shadow Chief Secretary to the Treasury managed the unusual feat of opening the debate without mentioning a single measure in the Finance Bill, although he did brandish a very thin pamphlet, which we were told contained all the answers to the Labour party’s spending commitments. A number of important issues have been raised across the House tonight, and I will do my best in the time available—and as swiftly as possible—to respond to as many as I can.

Two weeks ago, the Chancellor was able to present a Budget that followed five years of economic growth, with the deficit cut by four fifths, the lowest levels of unemployment, the highest levels of employment in my lifetime, real wages rising and real wages rising fastest among the lowest paid. It was a Budget in which, as a result of responsible management of the public finances—meeting the serious challenges we inherited in 2010 in a serious way—we were able to invest the highest levels in our economic infrastructure for more than 40 years, including £460 million more a week than the last Labour Government for our roads, railways and broadband. The Budget increased funding to the NHS by £20.5 billion a year in real terms; froze fuel, beer and spirits duty once again as a result of sustained lobbying and support from Members on the Government Benches, including my friends from Scotland; and—above all—provided a tax cut for 32 million people.

My hon. Friends the Members for Croydon South (Chris Philp) and for Cheltenham (Alex Chalk) and many other Government Members welcomed our action to support the high street and to enable town centres to adapt and evolve to new circumstances and continue to be the cornerstones of thriving communities. That action includes a reduction in business rates for 30% of smaller retailers, investment in transformation and infrastructure through the £675 million future high streets fund, and planning reforms to make it easier, cheaper and quicker to create businesses and work places in town centres and to create homes—planning reforms that are now, it seems, opposed by the Labour party.

My hon. Friend the Member for Croydon South made an interesting suggestion about the seed enterprise investment scheme. In the Budget, we reaffirmed our commitment to the world-class incentives we have as a country to encourage investment, promote wealth creation and make this country the best place in the world to be an entrepreneur, such as continuing entrepreneurs’ relief and continuing EIS and SEIS, as my hon. Friend suggested.

My hon. Friend the Member for Dover (Charlie Elphicke) and many other Government Members welcomed our sustained commitment to reducing corporation tax again—now to 17%—and noted that our decision to reduce it from 28% had not, as was suggested, reduced receipts to the Treasury, but had in fact increased them by 55%. My hon. Friend the Member for Gordon (Colin Clark) made the case, as he regularly does, that we want to grow the economy and support the people out there who are creating small businesses. This Budget and this Finance Bill are for them.

[Alan Brown]

I thank the Minister for giving way. If reducing corporation tax brings in more money, why has the Red Book never shown that, and why is the Treasury not able to provide any modelling that shows an increase in revenues from that reduction?

[Robert Jenrick]

I think I have already explained that the facts speak for themselves. Receipts from the reduction in corporation tax have increased by over 50%. That measure was opposed by the SNP and the Labour party.

My hon. Friend the Member for Solihull (Julian Knight) represents many people who work in the automotive sector, which we want to support. He asked about vehicle excise duty. In this Bill, as he knows, we are legislating to increase support for low-emission taxis and have brought that measure forward by a year. We have also increased support for electric charge points, to help the further roll-out of electric vehicles, as other hon. Members across the House have suggested. As I discussed last week with the chief executive of Jaguar Land Rover, who supported this strongly, we intend to review the consequences of the new worldwide harmonised light vehicle test procedure on vehicle excise duty and report back in the spring.

The right hon. Member for Twickenham (Sir Vince Cable) spoke of the need to incentivise further business investment, particularly at this important moment in the Brexit negotiations. I am sure he will welcome the increase in the annual investment allowance from £200,000 to £1 million, which will encourage businesses across the country, including manufacturers, to invest in new plant, new machinery and digital technology and raise their productivity, as well as the new structures and buildings allowance, which started on Budget day.

The Budget laid out a whole range of measures—exactly the ways forward that the right hon. Gentleman suggested—to increase productivity, which is the only sustainable way to improve living standards in this country, including the largest ever investment in our strategic road network and investment in our skills base, including the introduction of T-levels, encouraging apprenticeships and the national retraining partnership.

[Theresa Villiers (Chipping Barnet) (Con)]

I very much welcome the money in the Budget for repairing potholes. Does the Minister agree that it is vital that our great capital city gets its fair share of that funding?

[Robert Jenrick]

I certainly do. Some Opposition Members were snobby about potholes, but those of us in the real world know that potholes matter. They affect people’s working lives, and we want to fix that problem. In answer to my right hon. Friend, Barnet will shortly be receiving £690,0000 for potholes.

The hon. Member for Aberdeen North (Kirsty Blackman) and many others welcomed the transferable tax history, which we announced in the Budget and which she advocated. She was strongly supported by our Scottish Conservative colleagues. The oil and gas industry is a national economic asset and one that we want to support. It supports 280,000 jobs across the Union, but particularly in north-east Scotland. In the Budget, the Chancellor reaffirmed our commitment to strong, competitive and predictable taxation, so that the industry—which is, as the hon. Lady said, still fragile—can continue to strengthen in the years ahead.

Many of my hon. Friends, including my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), welcomed the introduction of the increase in the personal allowance and the increase in the higher-rate threshold—a tax cut for 32 million people, more than 1.5 million more working people taken out of tax altogether and achieving an increase in the personal allowance by more than 90% since 2010, which is a promise made in our manifesto and a promise delivered in the Budget.

My hon. Friend the Member for Walsall North (Eddie Hughes), as well as quoting Tiberius—I am yet to know whether Tiberius is quoted in No. 11; perhaps the Chancellor will invite my hon. Friend round for a cup of tea—was absolutely right to say that the Bill takes forward the measures in the last Budget to create a stamp duty relief for first-time buyers in other properties and extend it to those in shared ownership. That encourages and increases the dream of home ownership to a new generation.

As the Financial Secretary said at the beginning of the debate, the Bill also makes a number of changes to make our tax system fairer, and many Members across the House welcomed the new digital services tax. Some asked why we do not go further and faster, but let us remember that we will be the first major economy to create a tax of this nature. We are genuinely leading the international community and we hope to lead a multinational agreement, but the UK, under the leadership of the Chancellor, will lead the way. With those measures and others in the Bill, we will continue to close the tax gap, which is at its lowest ever and lower than in any year of the last Labour Government.

The hon. Member for Wakefield (Mary Creagh), at the beginning of the debate, and other hon. Members later, asked what action we are taking to support the environment and on climate change. One such measure, of course, is our proposed plastics packaging tax—again, leading the world by creating an innovative tax that encourages the producers of plastic packaging to take responsibility and change their packaging, and building on great Conservative environmental taxes of the past, such as the landfill tax created by my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke).

My hon. Friends the Members for West Aberdeenshire and Kincardine (Andrew Bowie) and for Moray (Douglas Ross), among others, said very clearly—this is an important dividing line in British politics—that we are excited about the future of this country, and want to support and invest in science and technology and in research and development to drive the economy forward. From the Labour party, we heard no ideas as to how to grow the economy. We heard about more spending and higher taxes, but nothing about how to create wealth and make our country more prosperous. We heard only ideas that we know have failed in the past.

Let us be clear: a vote against the Bill tonight would be a vote against enabling investment and new jobs in the north-east of Scotland and a vote against the transferable tax history, which the hon. Member for Aberdeen North says she has campaigned for and advocated over many years. It would be a vote against further investment in manufacturing to raise productivity, which Opposition Members have said should be a national priority, and a vote against the increase in the annual investment allowance. It would be a vote against extending the stamp duty land tax relief for first-time buyers to those who want to live in shared-ownership properties, something advocated by my hon. Friend the Member for Walsall North. A year ago, the Opposition voted against our first policy in this area. Today, we know that more than 120,000 people across the country have benefited from that stamp duty relief. Surely the Labour party will not make the same mistake again.

Anyone who votes against the Finance Bill tonight will be voting against further actions to close the tax gap and to make it harder to evade and avoid taxation, and against making our tax system fairer. It would be a vote against a tax cut for 32 million people, and a vote against taking more than 1.5 million of our fellow citizens out of income tax altogether.

The Bill will make the UK more competitive, more innovative and more entrepreneurial. It will deliver lower taxes and put more money into the pockets of our British working public. It will make our economy and our country stronger, and I commend it to the House.

Question put, That the amendment be made.