TaxPersonal TaxBudget row hots up

Budget row hots up

Angry Commons debates centre on tax harmonisation fears and stamp duty increase.

Arguments over European tax harmonisation look set to cloud debate over this year’s Finance Bill, after the opposition warned during angry Commons exchanges last week that the top rate of UK stamp duty could more than triple.

Conservative accountant MP Nick Gibb raised the prospect of future EU tax ‘harmonisation’ at the 12.5% level of similar taxes in Belgium, and the 10% levied in Portugal.

He protested that, far from affecting homebuyers alone – the UK’s highest rate is currently 3.5% on transactions over £500,000 – business would be hit harder still.

Gibb was pressing an opposition amendment to the Bill that would limit the increases to domestic houses. The Budget increases the duty from 2% to 2.5% on transactions between £250,000 and £500,000, and to 3.5% over £500,000.

He challenged financial secretary Barbara Roche to deny that the intention is to move towards continental levels of taxation on transactions in the same fashion as chancellor Gordon Brown’s promised not to raise corporate taxation before the next general election.

Roche fuelled the speculation by refusing to respond – instead accusing the Tories of seeking to complicate a simple tax on transactions. She also attacked the Conservatives for failing to cost their ideas.

The Tory proposal to exclude property subject to business rates failed by 308 votes to 126.

The vote followed a warning from shadow Treasury minister John Whittingdale that stamp duty would have to be removed from share dealings if London was to avoid losing business to Frankfurt.

Members also debated the removal of widows’ bereavement allowance and the married couples’ allowance – the latter a year before the introduction of the children’s allowance to replace it, claimed to save the Treasury £2bn.

Shadow chief secretary and accountant David Heathcoat-Amory led the criticism of the scrapping of the married couples allowance – save for those over 65 on 5 April next year. He proposed the relief should continue for all pensioners.

This week deliberations on further detail of the Budget legislation moved ‘upstairs’ to a Commons committee room, with early debates scheduled on alcoholic drinks, tobacco, gambling as well as further discussion of taxes on fuel and vehicle excise duty.

Related Articles

HMRC urged to clarify impact of income allowances on Self-Assessments

Personal Tax HMRC urged to clarify impact of income allowances on Self-Assessments

6d Alia Shoaib, Reporter
New trading allowance: simplicity, but not as we know it

Administration New trading allowance: simplicity, but not as we know it

1w Emma Rawson, ATT Technical Officer
Wealthy individuals could circumvent top tax rate rises

Personal Tax Wealthy individuals could circumvent top tax rate rises

2m Alia Shoaib, Reporter
HMRC tax evasion assistance requests double in five years

Corporate Tax HMRC tax evasion assistance requests double in five years

3m Emma Smith, Managing Editor
Rangers tax case to have ‘dramatic’ consequences for football and business

Legal Rangers tax case to have ‘dramatic’ consequences for football and business

4m Emma Smith, Managing Editor
Italy grants first successful non-dom status application to former UK non-dom

Personal Tax Italy grants first successful non-dom status application to former UK non-dom

3m Emma Smith, Managing Editor
Industry reaction: Taylor Review does not go far enough in addressing tax issues

Legal Industry reaction: Taylor Review does not go far enough in addressing tax issues

3m Alia Shoaib, Reporter
Does the Taylor Review sufficiently address the gig economy?

Corporate Tax Does the Taylor Review sufficiently address the gig economy?

3m Alia Shoaib, Reporter