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Finance (No. 2) Bill

I beg to move, To leave out from ““That”” to the end of the Question, and to add instead thereof:"““That this House declines to give a Second Reading to the Finance (No. 2) Bill because the provisions contained in its two volumes and 475 pages increase complexity and instability in the tax system, discouraging business investment and damaging productivity and penalise hard-working prudent families seeking to provide responsibly for their future; and because the provisions undermine attempts to improve IT skills by abolishing the UK’s Home Computer Initiative, damage enterprise by abolishing the 0% rate of corporation tax, leave the UK with an ever-rising tax burden that damages its competitiveness and fail to prepare the country for the challenges and opportunities of the globalised world economy.””" I am pleased to follow the Chief Secretary, who opened our debate. I look forward to working constructively with him and his team on this important Bill and welcome the contribution made by the Treasury Select Committee in a report that will help, I am sure, to inform our debate. We broadly support what the Government seek to do in a number of provisions, but of course we wish to examine the details in Committee. We will look positively at anti-avoidance provisions, but we will seek to ensure that they target genuine tax loopholes and do not involve excessive compliance costs and complexity. I welcome the Chief Secretary’s confirmation that the Government wish to ensure that those provisions operate proportionately. In the past, that has not always proved the case, so we will endeavour to ensure that the Bill achieves that aim. We welcome, too, the attempt in clause 19 to crack down on MTIC—missing trader intra-community—fraud, but we are concerned that the Bill does not include an implementation date,. Given the vast sums lost to the Exchequer as the result of such fraud, I hope that the Paymaster General can assure the House in her reply that the Government have received the necessary EU derogations or that they are confident that they will receive EU permission to put those proposals into effect. With certain reservations, we welcome part 4, which deals with real estate investment trusts. My hon. Friend the Member for Rayleigh (Mr. Francois) will expand on that topic in his winding-up speech. Turning to the more controversial matters, in Finance Bill debates in the past nine years, it has almost become a ritual for the Opposition to express grave concern, not just about tax increases but about tax complexity. As we are about to embark on scrutiny of the Bill’s two volumes, 181 clauses and 25 schedules, I imagine that this year will prove no exception. For example, Ernst and Young’s Chris Sanger said of the Budget press notices:"““Confusion has been heaped on complexity. This is not the way to keep businesses in the UK or encourage them to invest here.””" We have 23 clauses and two new schedules on film tax alone, on top of lengthy existing legislation. As the hon. Member for Rhondda (Chris Bryant) pointed out, this is a matter on which there have been repeated amendments to legislation over the past few years.