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Finance (No. 2) Bill

I beg to move, That the Bill be now read the Third time. I should like to take the opportunity to thank all hon. Members who participated in Committee of the whole House and Standing Committee. Our debates have again been detailed, ensuring effective scrutiny. The Budget that my right hon. Friend the Chancellor presented to the House in March set out a vision for a strong economy and a fair society, with opportunity and security for all. The Bill delivers measures to enhance productivity, help create a fairer society, protect the environment and safeguard the revenues that are needed to deliver high-quality public services. The Bill introduces two new tax regimes—the real estate investment trusts—REITs—and the film tax, which have been warmly welcomed by stakeholders. The real estate investment trusts, which clauses 103 to 145 introduce, will improve the efficiency of our property markets and allow smaller investors greater access to property returns. Clauses 31 to 53 introduce a new and generous film tax relief, which will provide better targeted and more direct support straight to film production companies. The Government believe that, in a modern and fair tax system, we need to keep pace with a changing world. We need a tax system in which everyone pays their fair share of tax. To build a fairer tax system, we must take action against those who seek to avoid paying their fair share or set out to defraud the Exchequer. The Bill therefore takes action against tax avoidance, which distorts markets and adds no value to the UK economy. The vast majority of taxpayers do not engage in avoidance, and it would be inappropriate and unfair if the Government failed to act against it. Disclosures have enabled Her Majesty’s Revenue and Customs to become aware that a minority of employers are using highly contrived schemes to avoid paying income tax and national insurance contributions on their earnings. In 2004, the Government announced that they would take action against any such complex and contrived avoidance schemes, if necessary with effect from the date of that announcement. That is exactly what the Finance Bill does, and it is right to do so. It should also be clear to anyone in this House and outside that paying tax should not be voluntary. Before the Budget it became clear that some wealthy individuals were using trusts as a way to shelter wealth from inheritance tax, and schedule 20 addresses that unfairness, bringing the tax regime for accumulation and maintenance trusts and interest in possession trusts in line with mainstream rules for the taxation of trusts and discretionary trusts.