← Back to House of Commons Debates
Taxation Bill - Clause 27 - Power to clarify tax treatment of devolved social security benefits
19 April 2023
Lead MP
Kirsty Blackman
Debate Type
Bill Debate
Tags
NHSTaxationEmploymentBenefits & Welfare
Other Contributors: 30
At a Glance
Kirsty Blackman raised concerns about taxation bill - clause 27 - power to clarify tax treatment of devolved social security benefits in the House of Commons. Other MPs contributed to the debate.
How the Debate Unfolded
MPs spoke in turn to share their views and ask questions. Here's what each person said:
Lead Contributor
Opened the debate
I move amendment 21, which would limit the removal of the lifetime allowance charge to NHS staff by introducing a condition that the person must be employed for an average of more than 15 hours per week by an NHS body. This ensures that only those who are significantly involved with the NHS benefit from this tax relief.
Questioned why the argument for limiting the removal of the lifetime allowance charge to NHS staff does not equally apply to senior police officers.
Highlighted that about half the people affected by the lifetime allowance work in the public sector, and questioned if a different tax regime for public sector pensions would be fair for private sector workers. Also raised concerns regarding whether GPs should be excluded from this legislation due to their self-employed status.
Andrew Griffith
Con
Arundel and South Downs
The clauses remove pension tax barriers for highly skilled workers across sectors, increasing the annual allowance from £40,000 to £60,000 and removing lifetime allowances. This benefits NHS clinicians, police officers, military personnel, business professionals, and others, reducing retirement pressures. The changes also increase the money purchase annual allowance to £10,000 for those re-entering work after retirement. Additionally, clauses ensure fair top-up payments for low earners in net pay pension schemes.
Agrees that private sector workers also make valuable contributions to the country and would be right to feel annoyed at punitive tax regimes just for them, while public sector workers do not face such penalties.
Kirsty Blackman
SNP
Aberdeen North
Questions why bankers should receive exemptions from lifetime allowances and what benefit the country gets as a result, suggesting that other sectors might not deserve such favorable treatment.
James Murray
Lab Co-op
Ealing North
Argues against the proposed tax cuts which primarily benefit those with large pension pots, claiming they are not a targeted solution for NHS doctors. He supports new clauses aimed at providing a fair fix for doctors' pensions and criticises the government's blanket approach as an inefficient use of public funds.
Anthony Browne
Con
South Cambridgeshire
Intervened to argue that senior workers in other parts of the public sector are affected by lifetime pensions allowances, not just NHS doctors. He suggests there is a precedent for special schemes like the one for judges and highlights how these changes impact various sectors.
Robert Syms
Con
Poole
Supports the Government's decision to improve productivity in healthcare by reducing pension tax penalties for doctors and other high-skilled professionals. Argues that current pension rules discourage hard work and productivity, leading to early retirements among skilled medical staff which exacerbates NHS waiting lists. Provides anecdotal evidence from his constituency where some doctors have decided to delay their retirements due to the change in policy. Highlights potential tax benefits for the Treasury as delayed retirees continue working and paying taxes at higher rates.
Aaron Bell
Con
Newcastle-under-Lyme
Mr Bell supports clauses 18 to 25, arguing that they will incentivise people to stay in work longer and enhance productivity. He dismisses the Opposition's criticism as inconsistent and impractical. Mr Bell points out that those who retire early will eventually pay taxes on their pensions, negating any long-term cost concerns. He also criticises the public sector for its generous pension provisions compared to the private sector and highlights how clauses 19 and 25 will limit tax-free lump sums while maintaining a tapering mechanism for high earners.
Nigel Mills
Con
Watford
Mills argues against a special pension scheme for doctors, stating it is difficult to implement fairly and can lead to unfairness in taxation. He raises concerns about split careers, locum workers, and potential complications with tax allowances. Mills also criticises targeting specific sectors for different tax treatment as detrimental and believes the current system should apply equally across all sectors.
Andrew Griffith
Con
Arundel and South Downs
Mr. Griffith supports the amendment proposed by his colleague, stating that it ensures doctors do not retire early due to pension tax issues. He argues that this policy benefits patients and the economy as a whole by allowing workers to continue paying taxes at their normal rate for extra years of work.
Kirsty Blackman
SNP
Aberdeen North
The Government's policy on doctors’ pensions was suddenly expanded to include air traffic controllers and senior police officers, revealing a lack of foresight. The Minister’s justification for the policy change is weak, as they have been aware of the issues for over a decade but only now decided to abolish the lifetime allowance. Furthermore, similar schemes were allowed for judges, raising questions about consistency in applying such policies.
Eleanor Laing
15:30:00
Progressed slowly to give time for the Liberal Democrats to move their amendment. Discussed amendments 8, 9, 10 and 11 which allow generators of renewable energy to offset money re-invested in renewable projects against the levy. Also proposed a new clause requiring the Government to conduct an assessment of the impact of the Electricity Generator Levy on investment in renewables.
James Cartlidge
Con
South Suffolk
Explained that the electricity generator levy is designed to capture only the exceptional receipts that electricity generators make above their normal return, preserving incentives for investment in low-carbon electricity. Detailed provisions covering calculation of the levy and its application to various business structures. Emphasised that the tax applies only when revenues exceed pre-crisis expectations and does not apply to certain technologies or transactions.
Erith and Thamesmead
Supports the levy but questions its impact on renewables investment. Emphasises Labour's previous announcements on windfall taxes, energy bill caps, and pre-payment metre charges. Asks for clarity from the Government regarding measures to monitor the levy's effects.
Supports new clause 11 requiring an assessment of the electricity generator levy on renewable energy investment. Raises concerns about the tax system's impact on renewables, citing reports indicating potential investment loss and capacity shortfalls. Criticises the disparity between oil/gas subsidies and renewable incentives.
James Cartlidge
Con
South Suffolk
Argued against new clause 11, stating that the Government will review policies as necessary but not specifically for investment impact within six months. Emphasised UK's significant investments in renewable energy and the exceptional nature of recent high energy prices due to geopolitical factors. Rejected the idea of turning away from domestic oil and gas production immediately.
Caroline Lucas
Green
Brighton, Pavilion
Interjected twice, highlighting that no one is suggesting an immediate shutdown of oil and gas but argued for reducing new investments in these sectors given alternatives. Criticised the Government's lack of investment in energy efficiency and renewables.
Bob Stewart
Con
Beckenham
Inquired about whether beer prices would come down, showing support for the pub sector and real ale. Emphasised that it is crucial to ensure affordability for pubs.
Mark Jenkinson
Con
Folkestone and Hythe
Asked if an impact assessment was done on the benefits of such a change to the on trade, highlighting the need for evidence-based policy.
David Evennett
Con
Bexleyheath and Crayford
Stressed the importance of pubs in communities and praised the Government's measures to support them, citing examples like micropubs.
Alistair Carmichael
Lib Dem
Orkney and Shetland
Questioned why spirits were treated differently under the new system. Raised concerns about the impact on the spirits trade, indicating a need for more comprehensive support.
Daisy Cooper
Lib Dem
St Albans
Expressed concern over the £20 million increase in duty affecting port and sherry traders. Suggested simplifying the process by taxing fortified wine at a midpoint of 17.5% ABV to mitigate adverse impacts.
Alistair Carmichael
Lib Dem
Orkney and Shetland
Argues for a duty freeze on spirits production, highlighting the importance of Scotland's gin and whisky industries to local economies. Emphasises that such duties have an inflationary impact and stifle economic growth in fragile communities. Cites examples of successful past duty cuts leading to increased revenue. Questions the Government's strategy behind recent increases.
Jamie Stone
Lib Dem
Caithness, Sutherland and Easter Ross
Supports amendment 7, emphasising that distilleries are integral to local communities in Caithness, providing crucial jobs in sparsely populated areas. Advocates for the concept of 'levelling up' to support economically disadvantaged regions where distillery industries play a vital role.
Kirsty Blackman
SNP
Aberdeen North
She supports the amendment because it specifically addresses whisky and its impact on rural Scotland. She cites statistics showing that Scotch whisky is 4.9% of the Scottish economy, generating £8.1 billion annually, with 90% of spirits produced in Scotland. The current alcohol duty regime could damage economically fragile areas due to the high proportion of tax revenue taken by Treasury (£11.40 out of £15.22 for a bottle). She also raises concerns about clause 87 regarding post-duty point dilution.
Erith and Thamesmead
Supports clause 27 as it is administrative in nature. Concerned about the Government's indecision, U-turns, and delays on alcohol duty reforms. Labour supports simplifying the system while balancing business support, public health protection, and revenue generation. Highlights concerns for businesses affected by tax changes, particularly wine producers and Scottish whisky producers. Supports new draught relief but questions why it excludes the wine sector.
James Cartlidge
Con
South Suffolk
The Minister clarifies that not introducing an RPI-linked increase would have a significant cost but supports the differential duty to support pubs. He disagrees with the Scottish National Party's amendments and argues for independent forecasts from OBR, which he believes adds credibility to fiscal decisions.
Alistair Carmichael
Lib Dem
Orkney and Shetland
The Minister's arguments are unpersuasive according to the SNP MP, who believes the Government should be more realistic about the effects of their policies. He suggests that historical data contradicts OBR forecasts.
Jamie Stone
Lib Dem
Caithness, Sutherland and Easter Ross
The SNP MP argues that increasing industry activity would actually increase tax revenue for the Government. He highlights new distilleries as examples of potential economic growth in Scotland.
▸
Assessment & feedback
Summary accuracy
About House of Commons Debates
House of Commons debates take place in the main chamber of the House of Commons. These debates cover a wide range of topics including government policy, legislation, and current affairs. MPs from all parties can participate, question ministers, and hold the government accountable for its decisions.