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Finance (No. 2) Bill 2026-01-13
13 January 2026
Lead MP
Lucy Rigby
Bury North
Lab
Debate Type
General Debate
Tags
EconomyTaxation
Other Contributors: 68
At a Glance
Lucy Rigby raised concerns about finance (no. 2) bill 2026-01-13 in the House of Commons. A government minister responded. Other MPs also contributed.
How the Debate Unfolded
MPs spoke in turn to share their views and ask questions. Here's what each person said:
Government Response
The Minister explained that the Bill introduces measures relating to gambling duties and alcohol duty, aligning with a fair and modern tax system. She emphasised changes to pensions clauses aim to ensure generous tax reliefs are used for retirement savings rather than wealth transfer. Pensions enjoy significant tax benefits, costing £78.2 billion in 2023-24, necessitating targeted reforms to address inconsistencies and misuse of pension funds as vehicles for tax planning. The Bill contains fair and necessary reforms to the tax system that have been ducked for too long. They will help strengthen our economy by cutting inflation, restoring public services and finances. Minister Rigby emphasised that the changes are designed to target higher-harm, fast-growing online products while protecting UK horseracing and land-based betting. She assured concerns about job impacts and black market growth with measures already in place or planned. Defended the proposed reforms as fair, reflecting changes in gambling trends and harms. Rejected calls for new clauses asking for impact reviews within six months, citing OBR costings which include behavioural impacts. Emphasised that the Government is taking a fair and coherent approach, considering contributions from alcohol producers, pubs, and the hospitality sector. She highlighted the importance of balancing public finances with support for British pubs through initiatives like the new pro-growth licensing policy framework. The Government is uprating alcohol duty in line with RPI to maintain the real-terms value of the duty, which is assumed in OBR forecasts. Freezing or cutting alcohol duty would reduce revenue; HMRC data shows that changes to VAT and other taxes affect pub profitability negatively.
Lucy Rigby
Lab
Bury North
The Economic Secretary to the Treasury opened the debate, explaining that the Bill aims to stabilise and strengthen public finances, address cost of living issues, and renew public services. She highlighted that the Government rejects austerity and irresponsible spending commitments, focusing instead on fiscal responsibility and a tax system fair for all. Regarding clauses 63-68, she stated these changes are necessary to ensure pensions' primary purpose is saving for retirement rather than transferring wealth free of inheritance tax.
James Wild
Con
North West Norfolk
On behalf of His Majesty’s Opposition, I wish to speak to new clauses 22 to 24. These Labour Government have taken taxes to record levels, with £26 billion in additional taxes in this Budget and £66 billion since the election. This increases inheritance tax on estates and pensions from April 2027 onwards. Removing the exemption for pensions could undermine efforts to encourage people to save at a time when people are not saving enough. The measures will affect around 38,500 estates, raising £1.5 billion by 2029. I propose new clause 22 requiring the Chancellor to assess impacts on pension and household savings decisions, and personal representatives must identify every pension asset, calculate inheritance tax due within six months, and ensure payment within this period or face personal liability if they fail. The Association of Taxation Technicians and the Chartered Institute of Taxation suggest extending withholding periods and allowing instalment payments for illiquid assets. New clause 23 would require a proper consultation on the impacts and whether these changes deliver better outcomes for savers and pensioners. New clause 24 would compel HMRC to publish comprehensive guidance and set up a dedicated helpline due to the complexity of the new rules.
Daisy Cooper
LD
St Albans
This is a retrospective tax without transitional protection, undermining confidence in pensions planning. The Chartered Institute and ATT have raised concerns about personal liability for IHT on pension funds, making executors cautious before distributing estates. If representatives discover new pension funds after initial settlements, this would require recalculating IHT for every part of the estate, increasing the risk of miscalculation. Our new clauses 18 to 20 urge significant reforms to protect individuals from liability for unknown private pensions and reduce waiting periods for accessing inheritances during a stressful period.
Not explicitly mentioned but inferred as a Government MP
Party: Conservative
The Government do not want to introduce unnecessary reviews, amendments, and consultations on the pension tax policy changes. They believe their existing review processes are sufficient.
James Wild
Con
North West Norfolk
New clause 24 would require HMRC to publish comprehensive guidance on the implementation of policies affecting inheritance tax on pensions and establish a dedicated helpline for inquiries. The amendment aims to ensure that individuals are fully informed about how these changes will affect them.
Jim Dickson
Lab
Dartford
Dickson welcomed the tax change but sought clarification on how revenue raised would contribute to lifting children out of poverty. He noted that the Treasury Committee had recommended this change before the Budget.
Gareth Snell
Lab/Co-op
Stoke-on-Trent Central
Snell questioned whether there was evidence supporting the disincentivising effect of tax changes on harmful gambling. He also raised concerns about driving money towards the black market, as suggested by OBR forecasts.
Minister Rigby responded to Snell's point by highlighting NHS figures indicating higher risk levels among online gamblers compared to in-person bettors. She also addressed concerns about driving money towards the black market, emphasising measures being taken to prevent this.
Gavin Williamson
Con
Stone, Great Wyrley and Penkridge
Williamson raised questions similar to those posed by Snell regarding the risk of increasing the illegal betting market. He sought assurances that steps would be taken to mitigate this risk.
Minister Rigby provided reassurance about the small size of the current black market and outlined additional funding for better enforcement against illegal activities, noting £26 million allocated over three years.
Dawn Butler
Lab
Brent East
Butler congratulated the Minister on tackling online harms and excluding bingo halls from tax changes. She suggested considering making high streets safer regarding gambling and erasing an aim from the Gambling Act 2005.
Adam Jogee
Lab
Newcastle-under-Lyme
Jogee inquired about engagement with companies to ensure workers' interests are not adversely affected by the proposed tax changes. He highlighted bet365 as a significant employer in his constituency.
Minister Rigby acknowledged concerns about job impacts and noted that employment trends had already been declining before these policies were introduced. She also offered to engage further on the matter if requested.
James Wild
Con
Norfolk
Proposes that tax hikes could result in job losses and greater use of unregulated operators in the black market. Independent modelling from EY suggests potential loss of 15,000 jobs due to doubling remote gaming duty and a further 1,700 from general betting duty increase.
Alex Ballinger
Lab
Halesowen
Questions the opposition's stance on harmonising gambling taxes, suggesting it was initially proposed by his Government but rejected due to the impact on horseracing and other sectors. Criticises the current proposal for potential job losses and economic consequences.
Lizzi Collinge
Lab
Morecambe and Lunesdale
Supports clauses 83-85, stating that online gambling has evolved beyond traditional models, requiring higher tax on remote betting to catch up with the reality of the current market. Emphasises reducing incentives for harmful forms of online gambling.
Daisy Cooper
LD
Westmorland and Lonsdale
Supports doubling remote gaming duty as a fair way to raise revenue and address problem gambling. According to the Gambling Commission, online gambling companies saw revenues of £7.8 billion in 2024-25 while Public Health England estimates that gambling costs the UK economy about £1.4 billion annually. Clause 83 targets harmful forms of gambling such as online slots and casinos.
Alex Ballinger
Lab
Dudley North
Welcomes steps on remote gaming duty to target addictive and dangerous forms of gambling like online slots and casinos, which are designed to be psychologically manipulative. The measure raises remote gaming duty to 40% and general betting duty to 25% for remote bets.
Gareth Snell
Lab
Stoke-on-Trent Central
Mr. Snell defended the employment benefits provided by the gambling sector in his constituency, highlighting that bet365 alone employs thousands of people and contributes significantly to local economic regeneration. He warned about potential job losses due to tax changes and emphasised the need for caution when making moral arguments against gambling taxes.
Alex Ballinger
Con
Halesowen
Mr. Ballinger acknowledged that his comments were not intended to denigrate those employed in the gambling industry but argued that taxing online companies more could incentivize jobs moving into the land-based sector, which would be beneficial for employment.
Gareth Snell
Lab
Stoke-on-Trent Central
Mr. Snell reiterated his point about the economic importance of bet365 in his constituency and questioned whether specifically taxing gambling is the only way to fund child poverty relief measures.
Gareth Snell
Lab
Stoke-on-Trent Central
He expressed concern over the £6 billion that might move into the unregulated sector, questioning if the £26 million allocated for the Gambling Commission is sufficient to combat this issue.
Gosport
Expressed concerns about the taxation of the regulated sector and its potential to push more people into unregulated sectors. Highlighted discrepancies in duty rates for land-based gaming versus remote betting, despite recognising that remote betting is less harmful. Questioned whether this was intentional or oversight. Cited evidence from the Netherlands showing a significant increase in unregulated gambling after rate increases, which could reduce revenue and job opportunities.
Wolverhampton North East
Supports the proposed increases in remote gaming duty to 40% from April 2026 and remote betting duty to 25% from April 2027, arguing that this addresses harmful gambling practices. Emphasised support for bingo halls as community spaces not subject to new taxes, highlighting its role in supporting lower-risk activities. Stated that the changes will raise £1 billion annually to lift half a million children out of poverty.
Defended the proposed gambling duty increases as fair reforms reflecting modern gambling trends and harms, aiming to balance revenue generation with consumer protection. Announced an additional £26 million over three years for the Gambling Commission to enforce against illegal sites and protect consumers.
Carla Lockhart
DUP
Upper Bann
Asked for a commitment that Northern Ireland will receive its fair share of funding from the gambling duty increase, particularly for organisations supporting those with gambling addictions. Highlighted high rates of problem gambling in Northern Ireland.
Daisy Cooper
LD
St Albans
Asked about engagement with industry regarding remote gaming duty. She inquired whether the consultation discussed a different tax base for calculation, questioning why a specific measure was used.
Dave Doogan
SNP
Angus and Perthshire Glens
Questioned if the Minister had considered the cumulative effect of various taxes on hospitality businesses. He expressed concern about the overall impact on the sector.
Maidenhead
Stated that any pub he speaks to does not feel supported by this Government, questioning the claim that they are pro-pubs given the current tax environment. He pointed out that the profit margin from a pint is minimal.
Tonia Antoniazzi
Lab
Gower
Invited MPs to visit a local pub in her constituency to have a positive conversation about how the Government are listening and moving forward. She welcomed the idea of visiting establishments directly.
Jim Shannon
DUP
Strangford
Noted that more constituents are drinking non-alcoholic beer, suggesting it as a growing market opportunity to promote through the Bill. He highlighted the potential for socialising without alcohol consumption.
Mike Wood
Con
Kingswinford and South Staffordshire
Acknowledged that draught relief benefits licensed premises more than off-trade sales, questioning why the Chancellor did not reduce the draught rate to further support pubs.
James Wild
Lab
Fylde
Opposes the tax rises on alcohol duty. Argues that these increases will harm households and businesses struggling due to high prices and sluggish growth. Proposes new clause 26 for a statement on the impact of rising alcohol duty on hospitality, pubs, producers, jobs, and public finances.
Scott Arthur
Lab
Edinburgh South West
Acknowledges the shadow minister's point but questions his omission of alcohol harm. Suggests that moving people to drinking in the hospitality sector could reduce alcohol harm.
Edward Leigh
Con
Gainsborough
Expresses concern about the future of rural pubs and suggests creative solutions such as special credence for draught beer sales. Condemns the Chancellor's actions against the hospitality sector, citing potential closures.
Ian Roome
LD
North Devon
Agrees that many local pubs will go out of business due to policy changes, echoing concerns about job losses and economic impact on rural areas.
Luke Evans
Con
Hinckley and Bosworth
Supports the need for accountability in understanding the impact of measures that are yet to be brought forward by the Government, emphasising the importance of reviewing both current and proposed policies affecting pubs.
Gareth Snell
Lab
Stoke-on-Trent Central
Acknowledges but does not elaborate on the shadow minister's points about business rates and their impact on pubs and hospitality businesses.
Supports the idea of abolishing business rates for certain sectors, suggesting it as a more comprehensive solution than proposed tax tweaks by the Government.
Dave Doogan
SNP
Angus and Perthshire Glens
He noted a similar issue in his local high street involving betting shops next to off-licences selling cheap, high-strength drinks. He cited Scotland's minimum unit pricing policy as an effective measure.
Turner welcomed the Minister’s statement and highlighted that RPI remains a relevant indicator for working people despite criticisms. He suggested future uprating measures could consider alternative household costs indices (HCIs).
Daisy Cooper
LD
West of England
Cooper criticised the clause as another tax burden on struggling hospitality businesses and customers, exacerbated by rising rents, energy bills, and unfair jobs taxes. She emphasised hospitality’s role in communities and called for a report on cumulative impacts of alcohol duty measures alongside other fiscal changes.
Lee Dillon
LD
Newbury
Dillon agreed that pubs are vital to community life but criticised the Government's failure to deliver lower business rates as promised, exemplifying it through his father’s pub sale and rising rents.
Al Pinkerton
LD
Surrey Heath
Pinkerton pointed out specific examples of pubs in his constituency experiencing significant increases in business rates despite the Chancellor's earlier promises to support them with lower tax rates.
John Milne
LD
Horsham
Milne shared a publican’s perspective highlighting the unprecedented challenges faced by the hospitality sector, leading to potential closure of businesses and loss of jobs.
Questions whether the Liberal Democrats have adequately addressed the issue of the living wage and its impact. Asks about specific proposals to resolve the current issues faced by the hospitality sector, particularly regarding costings for proposed measures.
Edward Leigh
Con
Bognor Regis and Wyre Forest
Emphasises the importance of rural pubs, noting that many people in rural areas rely on cars to access local pubs due to distance. Asks Daisy Cooper to elaborate on the challenges faced by rural pubs.
Jacob Collier
Lab
Burton and Uttoxeter
Calls for differential rates of duty between supermarkets and pubs, known as draught relief, arguing that drinking in a pub is not the same as at home. Supports a higher multiplier on alcohol duty to encourage responsible drinking and support local economies. Points out significant increases in rateable values impacting his constituency's pubs.
Mike Wood
Lab
Kingswinford and South Staffordshire
People up and down the country may be justified in asking what the Government have against pubs. Many things are causing so many pubs to struggle and to question whether they can survive beyond the very short term—the enormous increases in business rates, the increases in employer national insurance that particularly hit those who employ part-time workers, and the ever-growing burden of regulation, not least in the Employment Rights Act 2025, that affects many pubs and hospitality venues—but I think that this clause in the Bill really sums it up. The Government did have a choice. The Chancellor could have built on a success of the previous Conservative Government—in fairness to her, she actually did so last year—by reducing that draught duty rate so that duty on beer and cider sold on draught in pubs was paid at a lower rate, perhaps at the same time as extending the differential with supermarkets and off-sales that might be sold at or below cost price. But she chose not to do that; she chose to increase duty on top of all the extra burdens that are threatening the survival of our community pubs, bars and other hospitality venues.
Gareth Snell
Lab
Stoke-on-Trent North
That is a challenge that those venues have to face, and I hope the Government will look seriously at finding a realistic workable solution. The value of pubs in our communities is not just about the pints that they sell, but about the people they look after, such as the old gent nursing a pint for a couple of hours and being looked after by the bar staff. We lose that at our peril. One of the things that the Treasury has done for many years, including under the Conservative Government, is to keep an unfair differential between the rate of duty applied to cider and that applied to beer. That came in during the coalition Government and I can only presume that it had something to do with the number of Lib Dem seats in the south-west.
An MP
not specified in the transcript
Proposed a non-tax measure to support small brewers across the country, which would involve replicating a mechanism already in place in Scotland that guarantees access for small brewers to local pubs. The proposal aims to help small independent breweries sell more beer where a lower rate of duty is applied.
John Lamont
Con
Berwickshire, Roxburgh and Selkirk
Expressed concern over the hike in alcohol duty, which he claimed would be detrimental to the Scottish whisky industry and the hospitality sector. He cited figures showing that the whisky industry contributes £7.1 billion to the UK economy and supports 41,000 jobs in Scotland. Lamont highlighted that a previous tax rise led to a fall in spirits revenue by £150 million according to the Scotch Whisky Association. He also mentioned the impact on pub closures due to higher taxes.
Asked John Lamont about unemployment levels being lower in Scotland compared to England, prompting a response from Lamont that while unemployment may be lower, the Scottish economy is highly taxed with underfunded public services like NHS and roads. Lamont called for replacing the nationalist Government with a pro-UK Scottish Conservative Government.
Paul Kohler
LD
Wimbledon
Discussed the impact of alcohol duty on his constituency, highlighting that it is causing significant hardship for hospitality businesses. He cited figures showing that alcohol duty brings in around £12.5 billion whereas the hospitality sector contributes over £60 billion to the economy and supports 2.5 million jobs. Kohler also mentioned a proposal for an emergency cut in VAT for hospitality to 15% until April 2027.
Adam Dance
LD
Yeovil
Asked Mr Kohler if he agreed with the new clause 9 proposed by Liberal Democrats, which calls for a review of the impact on the hospitality sector within six months. Adam Dance highlighted the lack of sufficient assessments and consultations regarding the proposals in the Finance Bill.
Torbay
Called for an assessment of the cumulative impact of proposals on the hospitality industry. Highlighted challenges including post-pandemic recovery, energy cost increases, and national insurance hikes.
South Devon
Cited local venue closures in Kingsbridge due to financial pressures from business rates and national insurance contributions. Supported a reduction in VAT for hospitality businesses.
Harpenden and Berkhamsted
Emphasised the need for Government support to prevent further closure of venues in her constituency, supporting a Lib Dem proposal to reduce VAT to 15% until April 2027.
Robbie Moore
Con
Keighley and Ilkley
Called for the Government to carry out a review of the impact of increased alcohol duty on pubs and hospitality, citing various financial burdens including soaring energy costs, minimum wage increases, and rising employer’s national insurance.
Critiqued the continued rise in spirit duty for Scotland's whisky sector, suggesting it could reduce revenue rather than increase it. Cited previous hikes that reduced revenue by 7%, costing £150 million.
Gideon Amos
LD
Taunton and Wellington
The hon. Gentleman noted the differential tax treatment between cider and other beverages in his constituency, suggesting that restoring the duty differential would support agriculture.
John Lamont
Con
Dumfries and Galloway
The hon. Member questioned the effectiveness of the Scottish Government’s Budget in addressing hospitality challenges, citing comments from UKHospitality Scotland's executive director.
Luke Evans
Lab
Wrexham
The hon. Member supported new clauses 9 and 26 to review cumulative impacts and alcohol consumption practices respectively. He criticised the Government for compounding issues faced by hospitality businesses with multiple policy changes.
Graham Stuart
Con
Beverley and Holderness
The hon. Member suggested that the Chancellor might have misunderstood the impact of her policies on hospitality businesses, questioning whether the Business Secretary was correct in identifying this as a failing of understanding.
Luke Evans
Con
Waveney
The Member shares concern that publicans are forced to reduce hours or lay off staff due to increased costs, leading to fewer jobs and economic impact.
Lucy Rigby
Con
Stretford and Urmston
The Government is taking a responsible decision by uprating alcohol duty in line with RPI. Freezing the duty would cost the Exchequer £400 million annually, which would need to be recovered elsewhere. The impact on hospitality businesses' costs is expected to remain comparable.
Daisy Cooper
LD
West Lancashire
The new clause aims to require a report assessing the cumulative impact of alcohol duty measures and wider fiscal changes such as NIC rates, business rates, and other operating cost factors on employment levels, number of businesses ceasing or starting trade, and financial sustainability.
James Wild
LD
North West Norfolk
The new clause requires the Chancellor to make a statement detailing the effects of alcohol duty increases on the hospitality sector, pubs, producers, employment rates, and public finances within six months after the Act's passage.
Shadow Response
None
Shadow Response
New clauses seek to mitigate impacts of measures increasing taxes on pensions, requiring the Chancellor to assess real impact on saving behaviour, consult properly, and provide clear guidance. We oppose these changes as they penalise saving and add stress for grieving families. Opposes the Chancellor's decision to increase alcohol duty, focusing on its impact on households and businesses struggling due to high prices and sluggish growth. Proposes new clause 26 for a statement on the impact of rising alcohol duty.
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