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House of Lords (Members’ Taxation Status) Bill [HL]

I should say at the outset that, echoing the words of my noble friend Lord Strathclyde at Second Reading, we have no particular difficulty with the broad principle behind the Bill, which in a nutshell is that there should be no representation without taxation. However, the debate that has already taken place has demonstrated some of the complexities and has started to explain why, as my noble friend Lord Strathclyde said at Second Reading, such matters would more appropriately be dealt with in a government Bill. Furthermore, even if they are to be dealt with in a Private Member’s Bill, another Private Member’s Bill covering this subject is already under consideration in another place—Mr Gordon Prentice’s Disqualification from Parliament (Taxation Status) Bill. It is a rather more all-encompassing Bill in that it covers both Houses of Parliament, which I think I am right in saying would make this Bill superfluous. I am afraid that I fail to understand why the noble Lord, Lord Oakeshott, is aiming his guns exclusively at your Lordships’ House. If changes are needed in this area, surely they are needed every bit as much in another place. I shall return to this issue later when we discuss another amendment tabled to rectify that irregularity. As regards this group of amendments, which concerns the inclusion or not of domiciliary status, I noticed that at Second Reading the Minister said: "““We would have to think very carefully indeed about an approach which involved deeming another group as UK domiciled””.—[Official Report, 14/3/08; col. 1720.]" I think that my noble friend Lord Selsdon has expanded adequately on concerns in this area. This whole matter needs considerably more thought. If the issue is genuinely and simply one of taxation status, however defined, surely more than a few Members of your Lordships’ House have worked abroad while being Members and have not paid full UK tax, possibly—dare I suggest it?—even Liberal Democrat Members. As regards my noble friend’s proposed deletion of the words, "““and in no other country for taxation purposes””," I agree with what my noble friend Lord Strathclyde said when he pointed out at Second Reading that this Bill appears to argue that Members of your Lordships’ House cannot have tax residence in any country other than this one. In fact, it says that they are deemed not to. First, I suspect that it is possible to be resident in more than one country for tax purposes. Indeed, the noble Lord, Lord Oakeshott, acknowledged in his speech introducing his Bill at Second Reading that it is possible to be partly resident here and partly resident overseas. Therefore, if the Bill’s bottom line is to ensure that full UK tax is paid in this country, one problem that I think it will create is that some people will be subject to double taxation. I doubt whether the double taxation treaties all automatically result in the United Kingdom receiving its full share of tax, which definitively would mean that the other country did not receive the tax. Is that what is intended? Perhaps it is none of our business whether tax is paid additionally elsewhere, but I hope that that is not the case, because it seems somewhat unreasonable. Secondly, the amendment of my noble friend Lord Astor quite rightly specifically allows residence in another EU member state, a view that appears to be shared by the noble Lord, Lord Goodhart, in his Amendment No. 3 in the next group. The fact that this was not dealt with in the Bill in the first place raises questions, as my noble friend Lord Astor said, about how serious the position of the Lib Dems is on the European Union. My noble friend is absolutely right to probe where the boundaries should be drawn. So far the debate has brought out some important issues which need to be explained.