Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what recent discussions he has had with the Governor of the Bank of England on domestic pressures potentially impacting inflation; and if he will make a statement.
Answered by Andrew Griffith - Shadow Secretary of State for Business and Trade
Monetary policy is the responsibility of the independent Monetary Policy Committee at the Bank of England. The Government is working closely with the Bank to ensure that monetary and fiscal policy are well coordinated, and fully supports the Bank in their mission to drive down inflation.
Consistent with monetary policy independence, the Chancellor has regular meetings with the Governor of the Bank. Open exchange of views in these meetings is critical for the Government and the Bank to understand each other’s views on the outlook for the economy and monetary and fiscal policy, to support policy making in both institutions. These meetings are therefore confidential.
Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make an assessment of the potential impact of increasing the threshold for the (a) 45 per cent tax rate to £150,000 and (b) 40 per cent tax rate to £60,000 on the public purse.
Answered by Victoria Atkins - Shadow Secretary of State for Environment, Food and Rural Affairs
The Government must ensure the tax system supports strong public finances and it is right that higher earning households shoulder the most burden.
The additional rate threshold of income tax is set at £125,140 for 2023-2024. This was announced at Autumn Statement 2022 and was taken as part of a number of decisions to support public finances. Only the top 2 per cent of taxpayers are affected by this change.
The higher rate threshold is high enough to protect the vast majority of people from paying the higher rate of income tax. Around 80 per cent of all income taxpayers pay at the basic rate.
The Government’s approach to delivering fiscal sustainability is underpinned by fairness, with those on the highest incomes paying a larger share.
Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make an estimate of the potential impact of reducing (a) corporation tax to 15 per cent, (b) income tax to 18 per cent and (c) capital gains tax to 10 per cent on annual tax receipts.
Answered by Victoria Atkins - Shadow Secretary of State for Environment, Food and Rural Affairs
Spring Budget 2023 delivers a package of measures that further strengthen the UK’s position as one of the most competitive major economies. The economic and fiscal impact of changes in tax policy are factored into the Office for Budget Responsibility’s forecasts. Further detail is available in the OBR’s Economic and Fiscal Outlook which is published at fiscal events.
The Government keeps the tax system under constant review and the Chancellor has signalled his intention to cut business taxes further when it is responsible to do so.
Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make it his policy to reduce the level of VAT applying to the hospitality sector; and if he will make a statement.
Answered by Victoria Atkins - Shadow Secretary of State for Environment, Food and Rural Affairs
The previous VAT relief for tourism and hospitality cost over £8 billion.
The Government has been clear that this was a temporary measure designed to support the cash flow and viability of sectors that have been severely affected by COVID-19.
We have continued to support and encourage the hospitality sector through other measures since then. At Autumn Statement 2022, the Government announced a package of changes and cuts to business rates worth £13.6 billion over the next five years, including an increased 75 per cent relief for retail, hospitality and leisure properties, up to a cash cap of £110,000 per business for 2023-2024. This is a tax cut worth over £2 billion for around 230,000 RHL businesses, to support the high street and protect small shops.
The introduction of a small profits rate of Corporation Tax, from April, keeps the rate at 19 per cent for companies with profits of £50,000 or less. This means around 70 per cent of actively trading companies will not see an increase in their Corporation Tax rate. The availability of marginal relief for companies with profits of between £50,000 and £250,000 means only around 10 per cent of actively trading companies will pay the full 25 per cent.
While there are no plans to reduce the rate of VAT paid by hospitality businesses, the Government keeps all taxes under review.
Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what recent assessment he has made of the potential merits of introducing arrivals duty free policies in airports on (a) tax revenue and (b) job creation; and if he will make a statement.
Answered by James Cartlidge - Shadow Secretary of State for Defence
Duty-free on arrival, which would apply to inbound passengers, would place additional pressure on the public finances to which excise duty makes a significant contribution. Any loss in tax revenue would have to be balanced by a reduction in public spending, increased borrowing or increased taxation elsewhere.
Although there are no plans to introduce such a scheme, the government keeps all taxes under review.
Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what recent assessment he has made of the value of Libyan-owned assets frozen in the UK in each of the last five years for which figures are available; and if he will make a statement.
Answered by Andrew Griffith - Shadow Secretary of State for Business and Trade
Since its establishment in 2016, HM Treasury’s Office of Financial Sanctions Implementation (OFSI) has undertaken an annual frozen asset review, requiring all persons or institutions that hold or control frozen assets in the UK to report to OFSI, from which the following figures are taken.
The figures are each an approximate total value of frozen Libyan assets in the UK:
September 2017 £12.061 billion
September 2018 £11.222 billion
September 2019 £11.809 billion
September 2020 £11.528 billion
The figures for the 2021 Frozen Asset Review are still being finalised and will be published in OFSI’s Annual Review later this year.
The value of frozen funds in the UK can fluctuate for numerous reasons. These include changes to sanctions designations, changes in share or market values, or certain financial activity being licensed.
Asked by: Laurence Robertson (Conservative - Tewkesbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether he has made an assessment of the effect of the cost of VAT to manufacturers where the Scottish Deposit Return Scheme reaches an 80 per cent bottle return rate; and if he will make a statement.
Answered by Lucy Frazer
The Scottish Government and the Department for Environment, Food and Rural Affairs both intend to introduce deposit return schemes for drinks containers. HMRC is working with them and other stakeholders to ensure the VAT implications of these schemes are understood and is exploring how the VAT regulations may be amended to support the scheme. HMRC will assess the impact of any VAT regulation changes.