Commons Sense

House of Commons · Ministers' Questions

Tax System: Fairness

Tuesday 20 December 2022 · 6 questions

Summarised by AI from the official record, so it can contain mistakes.

Read the full transcript on Parliament.uk

At a glance

Answered 2 Partly answered 4 Not answered 0

Key points

  • The Minister stated that everyone should contribute to sustainable public finances in a fair way.
  • The annual investment allowance is being set permanently at 1 million from April 1.
  • Non-doms paid 7.9 billion in UK taxes last year, contributing significantly to public services.

Topics (select to filter)

Questions & Answers

Q1 Virendra Sharma Lab
Taxation
Context

The MP is questioning the fairness of the current tax system and recent changes.

Question

What recent steps has the Minister taken to ensure fairness in the application of the tax system? Does he think it is fair that landlords and those on high incomes earned through trading stocks and shares pay less tax than those paid a salary?

Answer from Victoria Atkins

It is right that everyone contributes to sustainable public finances in a fair way. The autumn statement tax reforms mean that those with the broadest shoulders contribute the most. We are also implementing the OECD pillar two reforms so that multinational corporations pay their fair share of tax, and we are introducing measures to address tax avoidance and evasion to ensure that people pay the right amount at the right time. In relation to dividends and corporation tax allowances, we want to ensure, where we can, that unearned income is roughly comparable to earned income.

Partly answered

Not addressed: The specific ask regarding fairness in different income types was not directly addressed with concrete figures or policies.

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Q2 Virendra Sharma Lab
Business & Trade
Context

The MP is seeking support for R&D tax reliefs and capital allowances to help entrepreneurs, start-ups, and SMEs.

Question

Does my hon. Friend the Minister recognise that the Edinburgh reforms have helped make our financial services sector more competitive? I urge her to adopt a similar approach to R&D tax reliefs and capital allowances so that our world-class entrepreneurs, start-ups and small and medium-sized enterprises can benefit from the same advantages.

Answer from Victoria Atkins

We are setting the annual investment allowance permanently at £1 million from 1 April, and reviewing the research and development tax reliefs to ensure that while we rebalance the rates of relief out of fairness to the taxpayer, we target that relief at knowledge-intensive and innovation-intensive businesses.

Answered
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Q3 Alan Mak Con Havant
Taxation
Context

The MP is questioning the fairness of stealth taxes introduced in the autumn statement.

Question

For a bit of Christmas cheer, I agree with the Minister for once as she says that she wants those with broadest shoulders to pay most. Why then did the Chancellor pick the pockets of hard-working people through freezing tax allowances rather than tackling non-doms which could have brought in £3.2 billion?

Answer from Victoria Atkins

Non-doms paid £7.9 billion in UK taxes last year, a significant sum that contributes towards public services. The Chancellor has to bear in mind the contributions made by non-doms when reviewing rules.

Partly answered

Not addressed: The specific ask regarding stealth taxes was not directly addressed with concrete figures or policies.

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Q4 Andrew Gwynne Ind Gorton and Denton
Business & Trade
Context

The MP is seeking support for local businesses to compete against online giants in the context of a successful town deal.

Question

The success of our fantastic town deal in Redditch relies on our amazing SMEs, who tell me that they need to compete against the online giants. What more can the Minister do to ensure that our businesses play a full part in our vision for the future so we can continue to unlock Redditch?

Answer from Victoria Atkins

We are protecting high streets and small businesses, particularly in the retail, hospitality and leisure sectors, through a £13.6 billion business rates support package, despite having to make difficult decisions in the autumn statement.

Answered
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Q5 Rachel Maclean Con
Taxation
Context

The MP is asking for clarity on previous decisions regarding non-dom status and whether the current Prime Minister was consulted.

Question

I have asked Treasury Ministers three simple questions: whether the Chancellor has considered abolishing non-dom status; whether the Prime Minister was consulted about doing so; and whether, when the current Prime Minister was Chancellor, he recused himself from discussions on the matter. Will the Minister finally show that they have nothing to hide by answering my questions today?

Answer from Victoria Atkins

Non-doms paid £7.9 billion in UK taxes last year, a significant sum of money that helps pay for public services. Although we keep the scheme under review, we must recognise their contribution towards public service funding.

Partly answered

Not addressed: The specific ask regarding previous questions was not directly answered with concrete figures or policies.

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Q6 James Murray Labour (Co-op) Ealing North
Taxation
Context

Millions of working people and businesses are facing the highest tax burden in decades, while those who use tax havens have different rules. This is undermining public services and fair competition.

Question

We believe that to be trusted and effective, the tax system must be fair, yet while millions of working people and businesses across Britain are paying the highest tax burden in decades, those who use tax havens are playing by different rules. Those who benefit from tax havens are undercutting responsible businesses, undermining our public services and breaking the basic principle that we must all play by the same rules. Will the Minister agree that creating a fair tax system must involve challenging tax havens and those who avoid paying their fair share?

Answer from Victoria Atkins

I used to prosecute tax fraudsters for HMRC before I came to this place. On the income tax take, the top 10% by way of income paid 36% of all tax in 2020-21. We are proud that our distributional analysis for the autumn statement shows that decisions made at that fiscal event are progressive: the lowest income households will receive the largest benefit in cash terms and as a percentage of income, and will on average be net beneficiaries of decisions made on tax, welfare and amendments to the energy price guarantee.

Partly answered

Not addressed: The Minister did not directly address whether they agree that challenging tax havens is necessary for creating a fair tax system or what actions are being taken against those who avoid paying their fair share.

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