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Standing Committee B
Thursday 5 June 2003
[Mr. John McWilliam in the Chair]
(Except Clauses 1, 4, 5, 9, 14, 22, 42, 56, 57, 124, 130 to 135, 138, 139, 148 and 184 and Schedules 5, 6, 19 and 25, and any new Clauses and Schedules tabled by Friday 9th May 2003 relating to excise duty on spirits or R&D tax credits for oil exploration.)
8.55 am
Mr. Gerry Sutcliffe (Bradford, South): I beg to move,
That the Order of the Committee of 15th May 2003 shall be amended by the insertion at the end of paragraph (1) of the words ''and on Thursday 5th June when it shall meet only at 8.55 am''
We intend to amend further the Committee's sittings by agreement. I am happy that negotiations with my opposite number, the hon. Member for Spelthorne (Mr. Wilshire), have been fruitful and that we are moving towards a smooth running of the Committee and its business.
Mr. David Wilshire (Spelthorne): I am grateful to my opposite number, the hon. Member for Bradford, South (Mr. Sutcliffe), for ensuring that the discussions are friendly and helpful. We are seeking to co-operate as best we can.
However, I must again take a moment or two of the Committee's time to remind hon. Members that Her Majesty's Opposition are implacably opposed in principle to this method of doing business. We have objected to the practice of guillotining everything, but I shall not waste the Committee's time by rehearsing the arguments. I simply place on record the fact that the arguments are still valid.
I again place on the record the fact that we also object to the detailed and rushed way of considering a Finance Bill with knives. If the Committee so wishes I shall elaborate on that. However, the motion that is before us is to allow the Chief Secretary to vote against the euro this afternoon in the Cabinet. Provided that he votes in the correct fashion, we are happy to make it possible for him to attend the Cabinet meeting.
I want to mention another issue, so that I can put on the record our thanks to the Government. The programme motion that was changed last night on the Floor of the House not only took account of the sitting that we are losing this afternoon, but gave effect to the agreement that we reached to have a further sitting. Two extra sittings were agreed last night, and we appreciate that. We still need to discuss when we use those extra sittings. Do they come before or after a knife? Discussions are still taking place on that, and I have no doubt that we shall reach agreement.
Finally, I take this opportunity to make it clear that Her Majesty's Opposition are more than willing to co-operate as far as they can with the consideration of the Bill. To that end, I hope that we have shown thus far that we are not wasting time for the sake of it. We shall do justice to every clause. We are trying not to waste
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time, but we are not prepared to rush just to meet an artificially imposed timetable.
Mr. John Burnett (Torridge and West Devon): While we also welcome the net gain in sittings, anyone who has sat in the Committee for even one sitting will realise that there is a phenomenal amount of work to do and, regrettably, a phenomenal amount yet to do that has not been published. There is an enormous amount of work on the Bill, and there has been insufficient time in which to do it. That is to be regretted. Although there is a net gain and we are slightly better off, that does not alter our objections to the way in which the Bill has been handled and the fact that sufficient time has not been allowed for the scrutiny of this complex, difficult and what should be a time-consuming Bill.
Mr. Sutcliffe: I shall respond briefly to what has been said. I do not want to undo our fruitful and friendly negotiations, but I must refer to the fact that we are not trying to rush things. Anyone who witnessed the Committee's proceedings the other day saw two and a half hours being spent on three clauses, although I admit they were important clauses. However, we do not want to argue about that. We are trying to be as accommodating as possible, given the seriousness of the Bill. My right hon. Friend the Chief Secretary and his team are doing their level best to ensure that every clause is given due scrutiny. I have no doubt that the Committee will be able to meet its timetable with good speed.
Question put and agreed to.
Schedule 4
Stamp duty land tax: chargeable consideration
Amendment proposed [3 June]: No. 6, [Mr. Prisk] in
schedule 4, page 160, leave out lines 11 to 13.
9 am
Question again proposed, That the amendment be made.
The Chairman: I remind the Committee that with this we are discussing the following:
Amendment No. 188, in
schedule 4, page 160, line 20, leave out 'grant or surrender' and insert 'grant, surrender or assignment'.
Amendment No. 189, in
The Chief Secretary to the Treasury (Mr. Paul Boateng): May I say what a pleasure it is to be chaired by you, Mr. McWilliam? We all look forward to serving under you.
Before I come to the substance of the amendments, I cannot help but comment on the bizarre explanation for the Committee's decision not to sit this afternoon tendered by the hon. Member for Spelthorne, who speculated as to my actions in Cabinet. His speculation was so lurid as to suggest that the happy faces on his tie may denote more than simply a happy disposition. Perhaps they have some other significance, because
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they are fantastic in the extreme, and I am not talking about the happy faces—
The Chairman: Order. While we are discussing hon. Members' sartorial elegance, may I say that gentlemen may remove their jackets, as it is somewhat warm this morning?
Mr. Boateng: We are grateful to you, Mr. McWilliam, but I must return to the amendments.
Mr. Wilshire: To put the Chief Secretary out of his misery, I should tell him that I wear ties like this to remind me not to take myself too seriously.
Mr. Boateng: I can only say that there was never any danger of us doing that. I am gently pulling the hon. Gentleman's leg, because we are all very fond of him.
I am grateful for the opportunity to make an early response to the amendments, as I may be able to move matters along. At the end of Tuesday afternoon's sitting the hon. Member for Hertford and Stortford (Mr. Prisk) was speaking to three amendments to schedule 4, amendments Nos. 6, 188 and 189. It may save the Committee some time if I make my comments now and give the hon. Gentleman and other members of the Committee some good news. I shall take amendments Nos. 188 and 189 first.
Paragraph 15 of the schedule provides that a reverse premium does not count as a chargeable consideration in relation to the grant or surrender of a lease. That means that if a landlord pays his tenant a premium to take or surrender—hand back—a lease, no stamp duty land tax is payable. The two amendments together seek to clarify that a reverse premium does not count as a chargeable consideration in relation to the assignment of a lease either. Therefore if, as I appreciate does happen, an assignor pays an assignee to take an assignment—a transfer—of a lease, no stamp duty land tax would be payable. We understand that these two amendments originate from the Law Society, and I take this opportunity to thank it for its representations since the publication of the Bill.
As the Bill expressly excludes reverse premiums on grants and surrenders, I can see the argument that it should expressly exclude reverse premiums on assignments as well. After all, a surrender is simply an assignment to a particular person—the landlord. Although it could be argued that we should simply clarify the matter on the record, in this instance it may be easier if I confirm that we are willing to accept amendments Nos. 188 and 189. I thank the Law Society and the hon. Member for Hertford and Stortford for bringing these matters to our attention.
Amendment No. 6 would extend exemption from stamp duty land tax on the surrender and re-grant of a lease in schedule 4(14). Paragraph 14 mirrors the current treatment of surrenders and re-grants under stamp duty, which limits the charge to ad valorem duty when an existing lease is merely replaced by a new lease of the same subject matter. The paragraph simply ensures that, as now, there is no additional charge to ad valorem duty on the market value of the lease
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surrendered or granted. Any other consideration or rent payable under the new lease will, as now, be chargeable to lease duty in the usual way.
Sub-paragraphs 14 (b) and (c), which the Opposition seek to omit, ensure that under the new regime it is only leases of the same subject matter—of the same length and on the same or substantially the same terms—which qualify for exemption. That is not new. It reflects the current position in section 77(1) of the Stamp Act 1891. However, I am aware from the representations received that there are some wider points of detail surrounding the surrender and re-grant of leases, including the treatment of any premium or rental element. These issues are currently under discussion as part of the ongoing consultation on the lease duty proposals. I feel that that point could also be best taken up as part of that process, and that is our intention.
We are committed to ensuring that the legislation operates fairly and in such a way as to assist the flexibility of the business community, and I can assure the Committee that we will, of course, consider very carefully the wider issues raised as part of that ongoing consultation. Although I am not minded to accept Amendment No. 6 at this time, I undertake to the Committee that the point will not be lost. We will consult further on the wider points raised and, if necessary, return to them at a later date. Having accepted the two amendments and undertaken to reflect on the third, I hope that the Committee will accept amendments Nos. 188 and 189 and reject amendment No. 6.
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