Debates between Rosie Winterton and Ed Davey during the 2017-2019 Parliament

Loan Charge

Debate between Rosie Winterton and Ed Davey
Thursday 4th April 2019

(5 years, 1 month ago)

Commons Chamber
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Rosie Winterton Portrait Madam Deputy Speaker (Dame Rosie Winterton)
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May I just point out that interventions must be short? Please remember that interventions mean that other people have less time to speak.

Ed Davey Portrait Sir Edward Davey
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I agree with the hon. Gentleman. Let me take his point on retrospection into the substance of my speech.

Everybody has paid tribute to the Minister and I join in that, but I urge him to look at the retrospection issue. The all-party group has spoken to tax professionals and has read a lot of material. There is a debate about whether aspects of this are retrospective or not, and about where the retrospection lies. One group has been hit by the loan charge where the retrospective nature has been proven beyond doubt: taxpayers who have had their tax returned to the Treasury with DOTAS added—sometimes even without DOTAS added—and who have come clean on everything they have been doing. HMRC has accepted that and has not opened an inquiry. Their cases have been closed and time has passed. Under section 9 of the Taxes Management Act 1970, we have been giving taxpayers in that situation total protection from HMRC coming back to them. That has been true for decades. Indeed, we have signed international conventions to say that that is the way individuals should be treated. Yet here we are, going back on that. To be clear to the Minister, all the tax professionals we talked to believe that for closed cases, that was a transgression. Indeed, I asked them if they could find any example on the statute book ever of a Government passing a law to override taxpayer protections and they could not.

When the Government responded to that clause with a review, their argument against all the advice was that the charge was not retrospective because it was a charge on the loan as of now—the outstanding loan. That is interesting, because they had never before proven that loanable income. That was the whole point of this whole debacle. Moreover, the loans were taken out in the past. We might not call it retrospective and we might call it retroactive, but frankly it is the same thing for the ordinary person. The reply to the amendment to the Finance (No. 3) Bill was therefore simply not good enough; it was wrong. This is a breach in the rule of law, particularly for those people with closed tax years. At the very, very least, the Government should not apply the loan charge to those people; that is the recommendation of the all-party group.

We then come to people with open tax years. Sometimes there has been an inquiry years before—15 or 20 years ago. For many taxpayers, it was not really clear what that was. There was a little form. They were not told what their rights were or what they should do in response. They just sat there, and some of them did not even know there was an open inquiry. Those open inquiries have lasted for years, with, as the hon. Member for Scunthorpe (Nic Dakin) said, HMRC doing nothing. Surely that is HMRC incompetence, not mistakes by taxpayers. They are now paying because HMRC could not administer the tax system over that period, and tried and failed to get the law right. I am sorry, but HMRC cannot penalise our constituents with tax bills of tens of thousands of pounds because it could not do its job properly. That is not acceptable.

Leaving the EU: Negotiations

Debate between Rosie Winterton and Ed Davey
Tuesday 10th July 2018

(5 years, 10 months ago)

Commons Chamber
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Rosie Winterton Portrait Madam Deputy Speaker (Dame Rosie Winterton)
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Order. The hon. Gentleman really must not use the word “you”, and let us not carry on with this sort of exchange.

Ed Davey Portrait Sir Edward Davey
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Thank you, Madam Deputy Speaker. I know what was in the Liberal Democrat manifesto. In 2005, like all parties, we argued for a referendum on the European constitution. In 2015, we said that if there was a big change affecting sovereignty and powers, we would have a referendum. What happened afterwards was completely different, and the hon. Gentleman ought to know that.

I was saying that I detect that the demand for a people’s vote—a final say on the deal—is growing louder and louder. There are many reasons why I think that; it is not just evidence from the polls and from people talking to me around the country. I think it is a reaction to the chaos of this Conservative Government. If I were a Conservative MP, I would be embarrassed by the Government; I do not think we have been so badly governed since the second world war—probably before.

The Government simply cannot make up their mind about how to deal with the biggest issue of the day. They are totally split. The chaos of the past 48 hours beggars belief. It is pretty clear that the Chequers statement will not stand the test of time. The European Research Group, the hard-line Brexiteers, and some Tory remainers reject it and Brussels is saying that it is unacceptable. It is pretty clear that, after two years of effort, this chaotic Government cannot manage it. That is why we tabled this motion.

As one of my colleagues said earlier, people are sick and tired of Conservative Ministers, and indeed MPs, putting their personal or party interests above the nation’s. As my hon. Friend the Member for Oxford West and Abingdon (Layla Moran) said, when we talk to some colleagues outside the Chamber, they admit that Brexit is a disaster.