Asked by: Lord Beecham (Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government what assessment they have made of the report by EY EY Financial Services Brexit Tracker, published on 2 March; and what assessment they have made of the impact of the UK’s departure from the EU on (1) the transfer of assets from the UK to the EU, and (2) the UK economy.
Answered by Lord Agnew of Oulton
In November, the Chancellor set out his vision for a new chapter for the UK’s FS sector to the House of Commons.
The UK’s FS sector will remain global, open and competitive, while being underpinned by high quality, agile and responsive regulation, and safe and stable markets. It will pioneer financial technology to benefit consumers and businesses, use innovation and finance to tackle climate change and move to a net-zero future.
Asked by: Lord Beecham (Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government how much money they estimate wll be raised through the imposition of value added tax on face masks and personal protective equipment.
Answered by Lord Agnew of Oulton
On 1 May the Government introduced a temporary VAT zero rate on personal protective equipment (PPE) that meets the standard set out in guidance from Public Health England in order to ensure that affected sectors (such as hospitals and care homes) were able to have access to PPE as required. The Government has put in place new measures that will ensure the supply of PPE to these sectors from 1 November.
The zero rate therefore ended on 31 October (as legislated), and the costing of this measure will be subject to scrutiny by the Office for Budget Responsibility and will be set out at the next fiscal event.
An estimate of the revenue raised from VAT on other types of face masks or PPE that have never been subject to the zero rate is not available. HMRC do not hold information on VAT revenue from specific products or services because businesses are not required to provide figures at a product level in their VAT returns, as this would impose an excessive administrative burden.
In July, the Government announced in the Plan for Jobs additional expenditure of over £15 billion for PPE procurement.
Asked by: Lord Beecham (Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government how much extra revenue has been generated by the 12 per cent increase in Insurance Premium Tax on motor vehicles since 1 June 2017.
Answered by Lord Bates
The estimated revenue from the increase in the standard rate of Insurance Premium Tax from 10% to 12% effective from 1 June 2017 was updated at Spring Budget 2017, as follows for the period up to the current financial year:
2017-18: £520 million
2018-19: £840 million
It is estimated that approximately 35% of this relates to motor vehicle insurance.
Asked by: Lord Beecham (Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government how much revenue they have raised (1) annually, and (2) in total, as a result of the increase in Insurance Premium Tax at (a) the standard rate from 5 per cent in 2011 to 12 per cent in 2017, and (b) at the higher rate from 17 per cent in 2011 to 20 per cent in 2017; and what estimate they have made of the impact of the Civil Liability Bill on the future annual yield at each rate.
Answered by Lord Bates
Insurance Premium Tax (IPT) is a tax paid by insurers on all general insurance premiums. Any price changes following IPT increases are pricing decisions made by the insurers.
We cannot identify additional revenue that has directly resulted from an increase in Insurance Premium Tax (IPT) because increased revenue could also come from external factors increasing underlying prices and demand in the insurance market.
We have estimated the impact of both the rate rises and the Civil Liability Bill at previous fiscal events.
Increase standard rate to 6% and higher rate to 20% (Budget 2010)
| 2010-11 | 2011-12 | 2012-13 | 2013-14 | 2014-15 |
Exchequer impact (£m) | +115 | +455 | +445 | +455 | +455 |
Increase standard rate to 9.5% (Summer Budget 2015)
| 2015-16 | 2016-17 | 2017-18 | 2018-19 | 2019-20 | 2020-21 |
Exchequer impact (£m) | +530 | +1,460 | +1,510 | +1,530 | +1,550 | +1,580 |
Reform to motor insurance claims rules (announced at Autumn Statement 2015 - recosted for Autumn Budget 2017)
| 2017-18 | 2018-19 | 2019-20 | 2020-21 | 2021-22 | 2022-23 |
Exchequer impact (£m) | 0 | -10 | -35 | -45 | -55 | -55 |
Increase standard rate to 10% (Budget 2016)
| 2016-17 | 2017-18 | 2018-19 | 2019-20 | 2020-21 |
Exchequer impact (£m) | +80 | +200 | +205 | +205 | +210 |
Increase standard rate to 12% (Autumn Statement 2016)
| 2016-17 | 2017-18 | 2018-19 | 2019-20 | 2020-21 | 2021-22 |
Exchequer impact (£m) | 0 | +680 | +840 | +840 | +845 | +855 |
A time series of IPT receipts is available in the published Tax and NIC Receipts Statistics Table[1]. IPT receipts have increased from £2,941m in 2011/12 to £5,669m in 2017/18 (2017/18 figures are provisional and may be revised).
We are not able to break down receipts by the higher[2] and standard rates as this information is not recorded on the IPT cash receipts record (i.e. the taxpayer would pay HMRC in a lump sum). However, we do publish a breakdown by liability declared on the traders’ returns[3]. This information is published biannually, with the latest release dating to December 2017.
The IPT liabilities between January 2011 and December 2017 are as follows:
Total IPT liabilities: £25.4 billion
Of which accounted towards the standard rate of IPT: £23.6 billion
Of which accounted towards the higher rate of IPT: £1.8 billion
[1] https://www.gov.uk/government/statistics/hmrc-tax-and-nics-receipts-for-the-uk
[2] The higher rate of IPT is an anti-avoidance measure that applies in specific circumstances. Further information can be found here: https://www.gov.uk/hmrc-internal-manuals/insurance-premium-tax/ipt04905
[3] Information declared on IPT taxpayers’ returns (the liability) is inconsistent with the timing of the money paid (the cash receipts). Further information can be found here: https://www.uktradeinfo.com/Statistics/Tax and Duty Bulletins/ipt1217.xls
Asked by: Lord Beecham (Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government whether they intend to protect local authorities from the loss of business rate income that has been identified as a consequence of bringing forward CPI uprating in the 2017 Autumn Budget policy costings.
Answered by Lord Bates
I refer the Noble Lord to my answer of 7 December to PQ HL 3516.
Asked by: Lord Beecham (Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government whether, and to what extent, they intend to compensate local authorities for the loss of £2.3 billion over the next five years resulting from their decision that business rates will increase by CPI rather than RPI.
Answered by Lord Bates
Autumn Budget 2017 announced that the planned switch in the indexation of business rates from RPI to CPI will be brought forward by two years to April 2018. Central government will fully compensate local authorities for income lost as a result of this measure.
Asked by: Lord Beecham (Labour - Life peer)
Question to the HM Treasury:
Her Majesty's Government, in the light of the decision to introduce the Soft Drinks Industry Levy, whether they will review their decision in 2015 not to impose a levy on tobacco products; and if not, why not.
Answered by Lord Bates
The government has no current plans to review the decision not to introduce a tobacco levy. A levy would complicate the tax system, impose an administrative burden on businesses and HMRC and would create uncertainty for businesses and consumers.
The government remains committed to its objectives on tobacco policy; to raise revenue and protect public health. Budget 2017 increased tobacco duty rates by 2% above RPI inflation. In addition, a Minimum Excise Tax of £5.37 on a pack of 20 cigarettes was introduced on 20 May 2017, alongside standardised packaging and the new Tobacco Products Directive.
Asked by: Lord Beecham (Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty’s Government whether, in the light of the National Audit Office’s critical report on the proposed closure of local tax offices in the North East and the consequent reduction of staff, they will withdraw the planned measure.
Answered by Baroness Neville-Rolfe - Shadow Minister (Treasury)
The National Audit Office Report recognises that HM Revenue and Customs’ (HMRC) plans for regional centres are integral to its strategic aims to increase tax revenue and to transform the service it provides to customers. HMRC is reviewing timing and costs so while elements of its plans will change, there are no plans to change the strategy.
The Newcastle Regional Centre is scheduled to open at the Longbenton site from 2018-19. HMRC expects to retain Washington as a transitional site until 2024-25.
Asked by: Lord Beecham (Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty’s Government, further to the Written Answer by Baroness Neville-Rolfe on 26 October (HL2092), how many cases relating to failure to pay the minimum wage have been considered for criminal investigation; and how many have led to prosecutions.
Answered by Baroness Neville-Rolfe - Shadow Minister (Treasury)
The Government is determined that everyone who is entitled to the National Minimum Wage (NMW) and the National Living Wage (NLW) receives it. Anyone who believes they have been underpaid NMW or NLW should contact the Advisory, Conciliation and Arbitration Service (Acas) helpline on 0300 123 1100. HMRC reviews all complaints referred.
There have been 13 successful prosecutions for NMW offences since 2007, with 4 of these in the 2016 calendar year. However, prosecutions are not necessarily the best approach in most cases. Criminal sanctions against companies mean that workers – the ultimate beneficiaries of enforcing the NMW and NLW – end up waiting longer for their lost earnings to be paid back.