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National Insurance Contributions Bill

As the Paymaster General knows, I have been involved in the process from the beginning and I have been impressed with her deft way of not answering questions. Several remain unanswered and I should like her to deal with them. First, does she believe that making a written statement in December 2004 was sufficient to make the proposals clear and plain to those who might be affected by them? Was her statement intended to create a precedent for other retrospective legislation? Secondly, will the Paymaster General give full details of just two out of the 100 schemes that she told us on Second Reading were so offensive that they should be stopped retrospectively? I acknowledge that retrospective tax legislation is not a new concept but it has previously required specific primary legislation to avoid being ultra vires. Clause 1 will allow the Treasury to pass subordinate regulations if and when needed. Does not that sound the death knell of legal certainty for tax planning purposes? Does the Paymaster General believe that the benefits of the measure outweigh the potential costs? Has any assessment been made of the potentially harmful consequences that the Bill might have for international businesses’ decisions about whether to establish themselves in this country given what might be interpreted as an increase in the Government’s use of retrospective taxation? The Bill should address the cause of the disease in the tax symptom, not the symptom itself. The disease is the complexity of taxation and the lack of clear response to legitimate tax planning. There is a continuum between legitimate tax planning that we all undertake and the notion that a few people are behaving illegally or illegitimately to escape their fair share of the burden of taxation. The Bill does nothing to tackle the undoubted uncertainty about the frontier of legitimate activity. The measure will compound rather than resolve the uncertainty. Question put and agreed to. Bill accordingly read the Third time, and passed.