Asked by: Claire Hanna (Social Democratic & Labour Party - Belfast South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make an assessment of the potential merits of reducing VAT to 10% in the hair and beauty sector.
Answered by Nigel Huddleston - Financial Secretary (HM Treasury)
VAT is a broad-based tax on consumption and the 20 per cent standard rate applies to most goods and services, including in the hair and beauty sector. Exceptions to the standard rate have always been limited by both legal and fiscal considerations.
The government recognises that accounting for VAT can be a burden on small businesses, particularly in sectors such as hair and beauty which involve selling directly to the final consumer. This is why, at £85,000, the UK has a higher VAT registration threshold than any EU Member State and the second highest in the OECD. This keeps the majority of UK businesses out of VAT altogether.
Asked by: Claire Hanna (Social Democratic & Labour Party - Belfast South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will provide compensation for self-invested personal pension holders affected by Hartley Pensions entering administration.
Answered by Bim Afolami - Economic Secretary (HM Treasury)
The Government is aware of the situation regarding Hartley Pensions, and we offer our sympathy to the customers affected. The FCA is responsible for regulating firms that provide self-invested personal pensions (SIPPs) and are working to ensure the best outcome for Hartley customers. SIPP providers must also comply with the relevant rules overseen by HMRC. Unfortunately, the Government cannot comment on any issues relating to an ongoing administration or court case.
Asked by: Claire Hanna (Social Democratic & Labour Party - Belfast South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether he has had recent discussions with the FCA on the effectiveness of its consumer duty in upholding standards of financial services for customers.
Answered by Bim Afolami - Economic Secretary (HM Treasury)
The Government is committed to ensuring the UK has world-leading levels of regulatory operational effectiveness and to ensuring that consumers of financial services have appropriate protections in place. The Consumer Duty aims to ensure that firms act to deliver good outcomes and seeks to set a higher and clearer standard of care that firms owe their customers.
Treasury ministers meet regularly with the FCA to discuss a range of topics including the Consumer Duty.
With any new policy intervention, it is appropriate to consider how effective it has been in meeting its objectives, once such an assessment can be made. The Financial Services and Markets Act 2023 introduced a new requirement on the financial services regulators to keep their rules under review, and to publish a statement of policy for how they conduct rule reviews. The FCA’s rule review framework can be found at https://www.fca.org.uk/publications/corporate-documents/our-rule-review-framework.
Asked by: Claire Hanna (Social Democratic & Labour Party - Belfast South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make it his policy to provide additional funding to the Department of Finance in Northern Ireland to help address RAAC in schools.
Answered by Laura Trott - Chief Secretary to the Treasury
Education is a devolved matter in Northern Ireland.
Asked by: Claire Hanna (Social Democratic & Labour Party - Belfast South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make an assessment of the feasibility of increasing the earnings threshold for eligibility for tax free childcare.
Answered by Laura Trott - Chief Secretary to the Treasury
The £100,000 per parent per annum earnings threshold in Tax-Free Childcare was set because the Government believes it strikes the right balance between helping parents with their childcare costs, and managing the public finances in a responsible way.
Asked by: Claire Hanna (Social Democratic & Labour Party - Belfast South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will reduce the duty rate for draught beer and cider.
Answered by Gareth Davies - Exchequer Secretary (HM Treasury)
The Government is unable to speculate on tax matters outside of fiscal events.
As with all taxes, the Government keeps the alcohol duty system under review during its yearly Budget process.
Asked by: Claire Hanna (Social Democratic & Labour Party - Belfast South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, with reference to the Answer of 14 January 2021 to Question 134263 on UK Internal Trade: Northern Ireland, what recent discussions he has had with the European Commission on the VAT Margin Scheme.
Answered by Victoria Atkins - Secretary of State for Health and Social Care
In order to provide certainty for businesses and to continue to support the Northern Ireland second-hand car market, the Government introduced the Second-Hand Motor Vehicle Payment Scheme on 1 May 2023. The scheme ensures that for cars moved after May 1 2023, businesses selling in NI will pay the same net amount of VAT as if they had continued access to the VAT margin scheme for these cars.
The Government is regularly engaging collaboratively with the EU as we implement the Windsor Framework.
Asked by: Claire Hanna (Social Democratic & Labour Party - Belfast South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether his Department has made an assessment of the potential impact of the replacement of the VAT margin scheme on small car dealerships.
Answered by Victoria Atkins - Secretary of State for Health and Social Care
In order to provide certainty for businesses and to continue to support the Northern Ireland second-hand car market, the Government introduced the Second-Hand Motor Vehicle Payment Scheme on 1 May 2023. The scheme ensures that for cars moved after May 1 2023, businesses selling in NI will pay the same net amount of VAT as if they had continued access to the VAT margin scheme for these cars.
The Government is regularly engaging collaboratively with the EU as we implement the Windsor Framework.
Asked by: Claire Hanna (Social Democratic & Labour Party - Belfast South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what the Barnett Consequential for Northern Ireland will be as a result of the 6.5% pay increase for teachers in England.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The Government has accepted the School Teachers’ Review Body’s pay recommendations for the 2023/24 teacher pay award in England in full. We are reprioritising from within the Department for Education’s existing budget to deliver the additional funding to schools in England for the costs of the pay award over 3.5%.
The Northern Ireland Executive (NIE) receives funding through the Barnett formula when UK Government departmental DEL budgets change. As there is no change to the Department for Education’s DEL budget associated with this announcement, there are no associated Barnett consequentials. Barnett consequentials for Northern Ireland would already have resulted from the Department for Education’s initial budget settlement at Spending Review 2021 (SR21).
The devolved administrations are well funded to deliver all their devolved responsibilities. SR21 set the largest annual block grants for the devolved administrations, in real terms, of any spending review settlement since the Devolution Acts. This provided on average £15 billion per year for the NIE. The NIE continues to receive at least 20% more funding per head than the UK Government spends on the same things in the rest of the UK.
A full breakdown of changes to devolved administrations’ block grants, including Barnett consequentials, is set out in the published Block Grant Transparency document.
Asked by: Claire Hanna (Social Democratic & Labour Party - Belfast South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will commit to reviewing the Higher Income Child Benefit Charge.
Answered by Victoria Atkins - Secretary of State for Health and Social Care
Restricting Child Benefit for those on higher incomes via the High Income Child Benefit Charge (HICBC) ensures that the Government can support the majority of families whilst keeping welfare expenditure sustainable. In 2020-21, the latest year that data is available, 88% of Child Benefit claimants were unaffected by the HICBC.
Moreover, the threshold for HICBC affects taxpayers who are on comparatively high incomes. In 2020-21, 99.7% of those who declared a liability for HICBC paid income tax at the higher rate or above. The Government therefore considers that the current approach to HICBC remains appropriate.
Nonetheless, the Government has introduced improvements recently. In April this year, we announced we would take steps to ensure parents can retrospectively receive a National Insurance credit. This means parents who were eligible to claim Child Benefit but who chose not to are able to protect their future State Pension entitlement. In July, we announced that employed individuals will be able to pay HICBC through their tax code, without the need to register for Self-Assessment, simplifying the process for taxpayers.