Business of the House
Debate between Mel Stride and Neil Gray(4 years, 10 months ago)
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Mel Stride
This is the second question calling for a debate on the northern powerhouse. As I said in answer to the first, I think it is a very good idea. We should collectively across the House, depending on the routes available, think about having such a debate, principally, from the Government’s point of view, because we feel we have made a substantial commitment to the north of England. We have had unprecedented investment in better transport across the north, as the hon. Lady will know, with £13 billion of investment so far—a record level—and further planned investment to come.
Neil Gray (Airdrie and Shotts) (SNP)
Dozens of my young constituents attend the Buchanan and St Ambrose High School campus in nearby Coatbridge. There has been much concern about the health of children attending the school since reports of teachers falling ill with the same type of cancer, and one boy with autism going blind, reportedly due to arsenic poisoning. Given that the site the school is built on is a former landfill that included arsenic, I am very grateful to the Scottish Government for having instituted an inquiry into this matter, following representations from Fulton MacGregor and Alex Neil, but I hope that the parents are involved at an early stage. Will the Leader of the House bring about a debate on building public buildings, including schools, on former landfill sites, so that we can get to the bottom of this?
Mel Stride
What the hon. Gentleman describes is obviously of considerable concern. I am pleased there is an inquiry, as he has set out, and I would certainly recommend that he raise the matter at Scottish questions on 19 June.
Oral Answers to Questions
Debate between Mel Stride and Neil Gray(5 years, 3 months ago)
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Mel Stride
We are truly the party for working people, as my hon. Friend states, unlike the Labour party. We are the party that raised the personal allowance to £12,500 one year ahead of our manifesto commitment to do so, taking well over 4 million of the lowest paid out of tax altogether. We are also the party of the national living wage, which will go up by 4.9% this April and be of great benefit to the very lowest paid in our country.
Neil Gray (Airdrie and Shotts) (SNP)
We knew that shifting the BBC licence fee concession to the BBC has always been folly, but we now know from the BBC’s consultation that the £745 million cost is likely to mean either a reduction in output, pensioners losing the concession, or both. Will the UK Government finally reverse this ridiculous decision and bring the concession back to the Government?
HMRC Estate Transformation
Debate between Mel Stride and Neil Gray(5 years, 3 months ago)
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Mel Stride
The hon. Lady raised a number of questions, one of which was about the issue of staff.
Mel Stride
If the hon. Gentleman gives me a moment, I will do precisely that, as I always do.
The answers to the hon. Lady’s questions relating to staff and the way in which we will be handling the staff are as I have set out. All staff will have at least one year’s notice of any impending move. The mapping process that HMRC undertook, as it went into the detail of where to locate the regional hubs, was very thorough. It took into account a number of principles, which I will come on to in a moment to answer another of the hon. Lady’s questions. Among those principles is the issue of the travel-to-work time, and every single employee’s home location was mapped against the possible new alternatives under consideration at the time those decisions were being made. I have also raised the issue of the transition offices, which are of course there, among other reasons, to provide employment opportunities for the staff.
The location principles—this comes to the questions the hon. Lady asked about why we have chosen one particular location rather than another, or indeed the existing location of the legacy offices—come down to eight key principles. They include transport connections, which are of course excellent in both Edinburgh and Glasgow, and the talent pool there, such as in universities—for example, Edinburgh and Glasgow have world-class universities—as well as the housing that is available, the quality of the schools and all the matters that will sustain the recruitment of the teams we will be bringing together in these 21st-century and much more sophisticated hubs for dealing with our tax purposes.
The hon. Lady raised the issue, which I know she has raised on previous occasions, of the location of these hubs in relation to our ports and points of entry into the United Kingdom. I think I can reassure her that, quite outside this whole process of the transitional arrangements, we will of course ensure that Border Force, HMRC and the Department for Environment, Food and Rural Affairs have the personnel available at those locations to make sure that they are able to run imports and exports efficiently. There is a general premise, however, in the suggestion that the offices somehow need to be close to people all the time. In fact, since 2014, it has been the case—[Interruption.]
Oral Answers to Questions
Debate between Mel Stride and Neil Gray(5 years, 5 months ago)
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Neil Gray (Airdrie and Shotts) (SNP)
I welcome HMRC’s rather belated decision to return tax wrongly paid by the Roadchef employee benefit trust. It is clearly now necessary to honour previously made commitments in respect of tax implications for beneficiaries. Did HMRC use its discretion to make that payout, and, if so, on what basis?
Mel Stride
The hon. Gentleman and I have had a number of discussions about this issue, both formal and informal, and have engaged in an Adjournment debate on it. I have always been very attentive to his specific questions, but if he would like me to meet him again to discuss the issue further, I should be more than happy to do so.
Oral Answers to Questions
Debate between Mel Stride and Neil Gray(5 years, 10 months ago)
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Mel Stride
As Departments right across Government do, we look at the opportunities available in various towns and cities up and down the country, including Bradford. The hon. Gentleman mentions the employment impact of this particular measure; I remind him that the employment rate in Bradford is up 6.4% since 2010. That is above the national average and is a direct consequence of this Government’s policies.
Neil Gray (Airdrie and Shotts) (SNP)
Mel Stride
I slightly detected from the hon. Gentleman’s question the suggestion that that meeting between HMRC and the EBT did not take place, and it most certainly did. He and I have discussed this matter, both formally in a meeting and informally, and we have debated it in the House. I have always stressed that there is a dividing line between HMRC and Treasury Ministers: we cannot intervene in the tax affairs of individuals or organisations. I am confident that HMRC is progressing in an appropriate manner.
Draft Social Security (Contributions) (Rates, Limits and Thresholds Amendments and National Insurance Funds Payments) Regulations 2018
Draft Tax Credits and Guardian’s Allowance Up-rating etc. Regulations 2018
Debate between Mel Stride and Neil Gray(6 years, 2 months ago)
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Mel Stride
I thank the hon. Lady for her observations, and especially for her broad support for the measures that we are bringing forward today.
On the issue of the thresholds and the potential benefit to higher earners as a consequence of upratings in the future, of course at this stage we are not at the £50,000 limit, so that is not a debate for today. A second point I want to make, on the issue of looking after the most vulnerable, is that we are doing a number of things from a Treasury perspective outside the benefits system, which were announced at the Budget, including a national living wage increase of 4.4%. That is well above inflation, something that the hon. Lady understandably referred to. That will begin in April. Of course, the increase in the personal allowance will take even more people out of tax, as well as providing a tax break for more than 30 million people.
Neil Gray (Airdrie and Shotts) (SNP)
The saving from the social security benefits freeze was estimated to be £3.5 billion, but because of increased inflation it is now estimated, according to the Library figures that we have obtained, to be £5.2 billion. Does the Minister think that the Government need to continue the benefit freeze under those terms?
Mel Stride
When looking at the impact of inflation on potential savings such as the hon. Gentleman describes, we have to bear in mind that many costs are going up for the Government as a consequence of increased levels of inflation. It is not simply something that can be looked at in isolation.
Roadchef Employees Benefit Trust
Debate between Mel Stride and Neil Gray(6 years, 4 months ago)
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The Financial Secretary to the Treasury (Mel Stride)
I am grateful to the hon. Member for Airdrie and Shotts (Neil Gray) for having raised this issue and secured this debate. I congratulate him also on the vociferous energy with which he has pursued these important matters—the Government recognise their importance. I appreciate that this matter is a source of long-standing concern for those affected, and I can fully understand that they would want a resolution soon. I assure the House that HMRC is working hard towards resolving this issue. As the hon. Gentleman has recognised, I am of course constrained by HMRC’s duty of maintaining taxpayer confidentiality, so my remarks on the case will, of necessity, be limited to matters already in the public domain. HMRC will, however, continue to correspond in writing with the trustee chairman and assist the employee benefit trust’s representatives.
It may be helpful if I first set out the typical tax treatment for the sale of shares from EBTs. When a person exercises an option to obtain EBT shares, this is often chargeable to income tax and national insurance contributions, based on the difference between their valuation when they are obtained and the amount paid for them. If the shares are sold to a third party, the sale will then be subject to capital gains tax on the difference between the valuation used for the taxation of the option and the sale prices.
Turning to the Roadchef EBT, as we have heard, the issue we are discussing today has a long history. Before the sale of Roadchef in 1998, the company’s then chairman arranged for shares held by the EBT to be transferred to him. He subsequently sold the shares for a profit. Both the acquisition and sale were taxed appropriately at that time. The former chairman’s actions were contested, and in 2014 the High Court ruled that effectively the moneys from the sale of shares had to be paid back, net of tax, to the trust for distribution to its beneficiaries. The judgment stated that the proceeds from the shares sold had been held on constructive trust by the chairman for the beneficiaries. However, the implementation of the High Court’s ruling in 2014 and the subsequent distribution of the original shareholders has proved to be very complex.
HMRC has since been engaging with the Roadchef employment benefit trustees’ representatives to determine the correct tax treatment for the trust and the relevant distributions to its beneficiaries. This involves HMRC working closely with the trust’s representatives to fully explore all potential legal options to settle this matter. HMRC’s most senior technical people have been working on different aspects of the tax position, and a senior HMRC representative is regularly discussing the progress of the case with the trust’s representative. Several media outlets have also reported how earlier this year HMRC provided a technical analysis of its view of the correct tax treatment to the trustee chairman and its representatives. To be clear, HMRC has no interest in prolonging this matter. It is, however, legally bound to be even-handed and impartial in applying the law.
Neil Gray
Can the Minister understand my concern at HMRC’s approach to this? When the trust was first made aware of the £10 million tax payment, HMRC apparently told the trust that the beneficiaries would not have to pay any tax on any pay-out that is made as long as the trust does not pursue HMRC for the £10 million. I think he can understand why that is a little concerning.
Mel Stride
The hon. Gentleman has raised a specific set of suggestions in the context of the dialogue between HMRC and the trust, and that very much strays into the area of confidentiality around discussions between our tax authority and a particular organisation. It would therefore not be right for me to comment on that. Indeed, in the normal course of events, I would not even be aware of such matters—certainly not from an HMRC perspective.
Mel Stride
I thank the hon. Gentleman for his invitation, which he also extended in his speech. I am certainly prepared to consider meeting him and potentially others, although I would like to take advice on whether that would be entirely appropriate, given the situation. I would appreciate it if the hon. Gentleman could explain more fully the exact nature of such a meeting, including who would be present and so on. In no way am I seeking to be unhelpful—quite the opposite—but I am conscious of the clear line that there must always be between members of the Government, MPs and, indeed, other members of the public, and the tax affairs that pertain between our tax authority and another organisation or business.
HMRC has a taxpayer confidentiality obligation, so I cannot comment in more detail on the specific tax treatment of the case. I can, however, assure the House that HMRC is doing everything that it can to resolve this issue promptly and fairly, while ensuring that the tax is paid appropriately in respect of the sale and distribution of the shares. Although HMRC has discretion as to how it goes about fulfilling its duties, as a statutory body it must of course apply the law fairly and collect the taxes set out in legislation by Parliament. When the law is unclear, HMRC can exercise some discretion to ensure that it gives effect to Parliament’s intent. For example, HMRC can exercise discretion to give up some tax if there is an unintended or unforeseen effect only a small group of taxpayers or that will be apparent only for a short time. I should note, though, that that discretion is by its nature limited and would not be applicable in all circumstances—for instance, it would not apply if the courts had made a specific ruling on a particular issue.
In summary, I thank the hon. Member for Airdrie and Shotts again for securing this debate and for the tenacity with which he has pursued these matters on behalf of his constituents and those of other Members. As I have said, I can appreciate the frustration of those affected, who naturally want a swift end to this matter, which I hope there will be. I hope I have been able to provide at least some reassurance that HMRC is doing everything in its power to resolve this issue in a fair and timely manner.
Question put and agreed to.
Tax Avoidance and Evasion
Debate between Mel Stride and Neil Gray(6 years, 5 months ago)
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Neil Gray (Airdrie and Shotts) (SNP)
The fact remains, though, that there is at least £30 billion of uncollected avoided or evaded tax; that figure could be as high as £120 billion, if we are to believe the Public and Commercial Services Union. Given that tax officers gain a significant tax return to the Treasury against their salaries, would it not be better to invest in tax officers rather than cutting their numbers, and to go after that multi-billion pound tax gap?
Mel Stride
Going after the tax gap is exactly what this Government are doing, and we have an exemplary record. We have the lowest tax gap in the entire world. It is the lowest in history—far lower than it was under the last Labour Government. The hon. Gentleman asked a specific question about tax officers. We need to move towards an HMRC that is ready and equipped for the 21st century. That does not mean a large number of scattered offices; it means hub offices with the necessary staff and technical skills to facilitate the transfer of knowledge and understanding in order to move forward.