Oral Answers to Questions

Debate between Claire Young and Dan Tomlinson

Tuesday 23rd June 2026 Commons Chamber

[Dan Tomlinson]

I understand that the VAT rate in Northern Ireland is different from the rate in Ireland—there are different rates of VAT across Europe. It is important to remember that VAT is a national tax in the UK, at 20% across the country. It is important to have consistency for businesses operating across the UK. Significant cuts to VAT come with significant fiscal costs. For example, halving the rate of VAT on hospitality would cost the Exchequer about £11 billion.

[Claire Young (Thornbury and Yate) (LD)]

5. What steps she is taking to reform business rates.

[The Exchequer Secretary to the Treasury (Dan Tomlinson)]

I am very busy today, Mr Speaker, as ever. I thank the hon. Member for asking about business rates. She will know that we have already started the work of reforming the business rates system so that we can put in permanently lower multipliers for high street businesses. As part of tax update day, we will be consulting on ways to collect more of the VAT that online sellers dodge by making online marketplaces liable for VAT on both UK and overseas business sales of goods. We will put every penny of the additional revenue raised into improving the business rates system for high street businesses.

[Claire Young]

When I met Chipping Sodbury chamber of commerce recently, business owners told me that the business rates system is broken and unfair, in part because it is based on turnover, not profit. In response to a letter, the Exchequer Secretary promised to bear in mind the points that I had raised ahead of future Budgets. Does he now accept that the business rates system is broken, and that rather than being reformed it should be abolished and replaced with a fairer system?

[Dan Tomlinson]

We have a tax on profits in the UK, which is corporation tax. In our corporate tax road map, we have committed to keeping that stable in this Parliament, rather than having it jump around as it did in the last one. It is important to have a broad tax base, so it is reasonable for business rates to continue to be—as they have been since the late 1980s—set in accordance with an estimate of the rents of properties. I do not think it would be right to change that.

Oral Answers to Questions

Debate between Claire Young and Dan Tomlinson

Tuesday 10th March 2026 Commons Chamber

[Claire Young (Thornbury and Yate) (LD)]

Heat batteries are the only clean heat technology certified by the microgeneration certification scheme that is excluded from VAT relief under the energy-saving materials framework. This penalises smaller homes and lower-income households that cannot accommodate a heat pump. Will the Chancellor commit to removing that anomaly, and meet me and representatives of the UK heat battery industry to discuss it?

[Dan Tomlinson]

The Government regularly assess whether to add energy-saving materials, including heat batteries, to the list of items covered by the current VAT relief, which is set to continue until March 2027. Any decisions would have to be announced by the Chancellor at a fiscal event, but I am happy to discuss the matter.

Business Rates

Debate between Claire Young and Dan Tomlinson

Tuesday 27th January 2026 Commons Chamber

[Dan Tomlinson]

I would be happy to discuss that matter with my hon. Friend. Indoor play is a really valuable and growing part of our economy, but there are challenges. With more free childcare, it may be that fewer people are going in during the day, and I know that many indoor play centres have seen increases in their rateable values. We set out our proposals on business rates at the Budget to support these businesses with significant caps this year, next year and the year after.

[Claire Young (Thornbury and Yate) (LD)]

When I visited The Play Shed in Yate last year, the reduction in retail, hospitality and leisure relief was already costing it £12,000, even before the more recent changes. This package is welcome for pubs and music venues, but what will the Government do to help other leisure businesses in my constituency that are struggling with business rates?

[Dan Tomlinson]

We have changed the tax rates, the multipliers, within the system so that a typical high street business may now pay 38p in the pound and an online retail giant may pay 51p in the pound on their rateable values. That is a significant underlying reform to the tax system that is here for good.

Agricultural Property Relief and Business Property Relief

Debate between Claire Young and Dan Tomlinson

Monday 5th January 2026 Commons Chamber

[Dan Tomlinson]

The amendment, which has already been laid before the House, sets out the changes that the Government are making. In the letter that all hon. Members will have received, we set out our estimate that the number of estates we think will be affected will halve, and that about 85% of farming estates claiming APR—sometimes with BPR—will not pay any additional inheritance tax at all as a result of these changes.

[Claire Young (Thornbury and Yate) (LD)]

Looking at farm sizes and land values locally, I fear that family farms will still be paying the family farm tax. What evidence is there that £2.5 million realistically reflects the value of a typical family farm in a constituency with higher land values, such as Thornbury and Yate?

[Dan Tomlinson]

May I thank all hon. Members on both sides of the House for their engagement on this important issue today? We have set the threshold at £2.5 million for a single person and £5 million for a couple as a result of the changes announced at the Budget 2025. We think that threshold is right and fair. It means that the number of farming estates that will be affected will fall by half, and the vast majority will pay no additional inheritance tax at all.