Key Facts

• Clause 321 introduces a new domestic APD band and an ultra-long-haul band.
• Domestic flights will see a 50% cut in APD, from £13 to £6.50 for economy class passengers.
• The ultra-long-haul band rate is set at £91 for economy class passengers, a £4 increase compared with the existing long-haul band.
• More than 10 million passengers are expected to benefit from the domestic APD reform.
• Clause 322 enables the Northern Ireland Assembly to set rates for the new ultra-long-haul band for direct flights departing Northern Ireland.
• The discussion includes Government amendment 9.
• The statement covers Clause 324 stand part.
• It also addresses Government amendment 10.
• Schedule 22 is to be added as the Twenty-second schedule to the Bill.
• The discussion concludes with Clause 325 stand part.
• VED rates for cars first registered since April 2017 will increase by £15, from £165 to £180.
• The HGV levy was suspended in August 2020 and will resume in August 2023.
• UK HGVs will pay around 20% less under the reformed HGV levy compared to the previous one.
• The number of rates for HGV levies reduces from 22 to 6, making administration easier.
• The new clause would require a published assessment by the Chancellor.
• The assessment must be completed within one year of the Act coming into force.
• The assessment covers the impact on meeting climate change targets set in the Climate Change Act 2008 and obligations under the Paris Agreement.
• Landfill tax increases from £3.15 per tonne to £3.25 per tonne and from £98.60 per tonne to £102.10 per tonne starting April 1, 2023.
• Climate change levy equalizes main rates on gas and electricity by increasing the rate for gas and freezing it for electricity until 2025.
• The plastic packaging tax increases from £200 to £210.82 per tonne starting April 1, 2023.
• Changes in climate change levy rates will raise £370 million by 2027-28 and result in greenhouse gas savings of 300,000 tonnes of CO2 between April 2024 and March 2028.
• Landfill tax rates are increased in line with inflation from April 1, rounded to the nearest 5p.
• The landfill tax was introduced in 1996 and has devolved in Scotland (2015) and Wales (2018).
• HMRC estimates a £125 million gap between landfill tax due and revenue collected in 2021, with an uncertainty rating of high.
• The plastic packaging tax was introduced in April 2022 to incentivize the use of recycled plastic.
• Clause 326 increases both rates of the landfill tax.
• Clause 328 increases the plastic packaging tax rate in line with CPI.
• Operation Nosedive cost HMRC £3.5 million in public money.
• The UK has ambitious net zero greenhouse gas emission targets: 75% by 2030 and 90% by 2040 for Scotland, with the UK targeting net zero emissions by 2050.
• An additional £13.5 billion of investment was needed last year to meet the UK’s net zero goals.
• Landfill tax has reduced local authority waste into landfill by 90% since 1990.
• A special operation from April 2020 to November 2022 closed 2,500 illegal waste sites and made 51 arrests.
• The landfill tax gap for England and Northern Ireland in 2019-20 was estimated at £200 million (22.7%).
• Clauses 330 and 331 will amend existing legislation.
• Each investment zone can benefit from interventions of £80 million over five years.
• Tax reliefs include full stamp duty land tax relief, 100% business rates relief, and a 100% first-year allowance for capital allowances.
• The enhanced structures and buildings allowance provides businesses with a 10% tax reduction per year.
• The employer national insurance contributions relief applies to new employees working at least 60% of their time in tax sites for up to £25,000 annually.
• The estimated value of the investment zones' tax reliefs is £45 million out of an £80 million funding envelope.
• The debate addresses concerns about whether investment zones will lead to an overall increase in investment or merely shift it around.
• Cheshire West and Chester's bid for an investment zone was unsuccessful, prompting difficult decisions for companies planning to locate there.
• £22.5 million has been invested in Tipton town centre as part of the Budget announcement.
• The MP discusses clauses 330, 331, and 332 of the Finance No. 2 Bill.
• Clause 330 is ordered to stand part of the Bill.
• Clause 331 is ordered to stand part of the Bill.
• Schedule 23 is agreed to.
• Clause 332 prohibits assignments of income tax repayments and aims to protect taxpayers from unscrupulous agents.
• HMRC received around 2,800 complaints about repayment agents last year.
• Clauses 333 to 335 correct minor defects in late payment penalty legislation for VAT.
• Clause 336 allows HMRC to update insurance premium tax forms through public notices instead of statutory instruments.
• Clause 337 aligns penalties for late payments of plastic packaging tax with other assessment penalties.
• The UK has approximately 540 aerodromes that may handle small private jets with passengers and goods under a duty allowance.
• Clause 338 allows HMRC to issue, condition, vary, or revoke approvals for aerodromes for customs purposes and make regulations about approval conditions and restrictions.
• Clause 340 provides HMRC discretion to extend temporary approvals after revocation decisions to allow businesses time to wind down operations without incurring penalties.
• Clause 341 makes licence renewal conditional on completing tax checks in Scotland and Northern Ireland from 2 October 2023.
• Clauses 343 and 344 restrict UK charitable tax reliefs to UK charities and community amateur sports clubs as of Budget day, with a transition period until April 2024.
• UK charitable tax reliefs were worth £5.5 billion in 2021-22.
• Income tax and corporation tax exemptions apply to 'thank you' payments made under the Homes for Ukraine sponsorship scheme.
• Temporary reliefs from the annual tax on enveloped dwellings (ATED) and the 15% rate of stamp duty land tax have been introduced.
• The Homes for Ukraine sponsorship scheme was announced in March 2022.
• The recommendation to abolish the OTS came from a former Chancellor in September 2022.
• The then Chancellor's growth plan led to an unprecedented £60 billion fiscal hole.
• George Crozier, head of external relations at the Association of Taxation Technicians and the Chartered Institute of Taxation (CIOT), argues that the OTS achieved significant accomplishments during its 12 years, including abolishing over 40 unnecessary tax reliefs and implementing useful reforms to employee expenses and inheritance tax reporting.
• Every Finance Act in the last decade has included measures influenced by the OTS.
• The Office of Tax Simplification (OTS) was abolished as part of the mini-Budget last September.
• There are currently 1,180 tax reliefs in the system, with 339 being non-structural.
• The Institute for Government argues that if the OTS is to be abolished, it should be replaced by a body with a wider remit.
• The Office of Tax Simplification was established in July 2010 and became a statutory body under the Finance Act 2016.
• On September 23, 2022, Kwasi Kwarteng announced the abolition of the OTS.
• The Chartered Institute of Taxation has pointed out that almost every Finance Act in recent years includes measures originating from the OTS.
• The Chancellor committed to reviewing tax simplification ahead of every Budget.
• Measures introduced include cash basis for business helping over 4 million sole traders and a £1 million limit to the annual investment allowance benefiting 99% of businesses.
• The Minister met organisations in April to discuss simplifying tax for low-income earners and assisting tax agents.
• Clause 347 expands the dormant assets scheme to include insurance, pension, investment, client money, and security assets.
• The expansion is expected to generate up to £880 million for good causes across the UK.
• Clause 349 introduces a 13-year time limit on funds unclaimed in Court Funds Office accounts.
• Some moneys have been held since 1726 in the Courts Fund Office account.
• Clause 350 prohibits HMRC from making payments to designated persons under financial sanctions regulations.
• New Clause 4 would require the Chancellor to publish a report within three months after the Act comes into force.
• The report must evaluate which provisions could not have been introduced if the UK remained in the EU, including costs and benefits.
• Gareth Davies argues that such information is already available through Budget documents and tax impact notes.
• The Minister thanks the Chair, Clerks, Hansard reporters, Whips, Treasury officials, and other Government Department officials.
• The statement mentions a measure in Part 2 of the Bill related to Alcohol Duty concerning flavoured beers, as reported by the Chartered Institute of Taxation (CIOT).
• The committee has completed its work on the Finance No. 2 Bill.