Dan Tomlinson MP: speeches

Speeches

• 1 Jul 2026 · Taxation (Energy and Vehicles) Bill · Hansard source

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  I beg to move, That the Bill be now read the Third time. I am grateful for the discussion that we have had today on a Bill that responds directly to the pressures placed on people and businesses across the UK by the conflict in the middle east. In respect of energy, rising gas prices have driven up electricity prices, and non-gas generators stand to benefit significantly as a result. The electricity generator levy ensures that a share of this exceptional revenue is redirected to the public, and we are increasing that share by raising the rate of the levy from 45% to 55%. As for fuel costs, we are uprating mileage rates for the first time in 15 years, providing relief for millions. We are also introducing a 12-month vehicle excise duty holiday for the majority of heavy goods vehicles, supporting those who drive for work and the transport of goods across the UK. Those three measures are the right measures at the right time, and I commend the Bill to the House.

• 1 Jul 2026 · Taxation (Energy and Vehicles) Bill · Hansard source

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  I will open this debate in Committee of the whole House by reminding the House—though I am sure Members know what is in this Bill—of the purpose of the Bill, which is to respond to increases in costs for families and businesses in the UK because of the conflict in the middle east. Even though we have just completed Second Reading, as we are now in Committee, I will address the clauses of the Bill in turn—Members will be relieved to know that there are only four clauses, so it should not take too long. I will address the amendments that have been tabled in my closing speech, which, with the leave of the House, I intend to make. Clause 1 makes changes to ensure that the electricity generator levy rate will rise from 45% to 55% from today, 1 July. As my hon. Friend the Economic Secretary to the Treasury set out, in the UK the majority of our electricity is generated from renewables. Despite that, when the crisis in the middle east pushed up international gas prices, the cost of electricity, and so the cost of living, rose too, because electricity prices are still largely set by the price of gas. The changes made by this clause will ensure that a greater proportion of any exceptional revenue that many non-gas generators may receive because of the conflict in the middle east is available to Government to support businesses and households where appropriate. As we have discussed, the Government also announced back in April that we are acting to de-link electricity prices from gas prices through new voluntary long-term fixed contracts being offered to existing low-carbon generators. As we have discussed, these are known as wholesale contracts for difference, and the changes made by clause 1, increasing the rate from 45% to 55%, will encourage participation at a competitive price in these WCfDs. Clause 2 makes changes to increase the generosity of mileage rates for 2026-27 for employees and self-employed individuals who use their car or van for work from 45p to 55p for the first 10,000 miles and 25p thereafter, with effect from 6 April 2026. I forgot to respond to the shadow Exchequer Secretary asking me earlier why we have not increased the rates above 10,000 miles. I did respond to that point in the Ways and Means debate last week and think the Government have got the balance right here. We are supporting all drivers, noting that of course for a driver who drives 10,001 miles, almost all of their miles will be covered by the higher rates, and it is still open to employers with employees who drive many more miles to set their own rates if they wish. I would just note that the Conservative party had many opportunities to uprate these mileage rates after 2011, when they did do so, but they demurred from that choice for 13 years in a row, and I am very glad to be part of a Government who have introduced the largest increase in a very long time, if not ever. The changes made by clause 2 will provide immediate support for both employees and the self-employed, and this is on top of the universal support announced in May, including the freeze on fuel duty, which will save motorists 11p per litre compared to previous plans, or £120 for the average car, or £250 for the average van. This clause represents the largest ever increase to these mileage rates, benefiting around 2 million employees and 1 million self-employed individuals, saving over £120 a year for a worker doing 6,000 business miles. Clause 3 reduces the vehicle excise duty liability for the majority of heavy goods vehicles to £1 for 12 months for licences taken out from today until 30 June 2027. The changes made by this clause are in recognition of the key role that the road haulage sector plays in transporting goods across the UK and its disproportionate exposure to fuel costs. Fuel costs make up a substantial proportion of HGV operating costs, and this action will help prevent cost pressures from the conflict in the middle east from spreading across the economy. The shadow Exchequer Secretary is right to point out that this measure on its own is not a silver bullet in helping the haulage sector, but I hope that it will provide some assistance, and it does show very clearly by our reducing this rate down to £1, saving HGVs £600 a year, that this is a sector that we do want to support and see grow and weather the storm from the conflicts in the middle east. We also want to do all we can to reduce costs in the supply chain, to keep prices in the shops for everyday families as low as possible. The decisions taken since the 2024 general election to freeze fuel duty will save the average HGV over £2,000. With that, having taken the Committee through the three clauses, I look forward to hearing the contributions from other Members.

• 1 Jul 2026 · Taxation (Energy and Vehicles) Bill · Hansard source

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  I thank the shadow Exchequer Secretary for that. As I said, we are consulting on that policy before the end of the year. It was the Chancellor’s and this Government’s decision that the better thing to do for the country—for businesses and for households—was to respond to the conflict in the middle east with pace and appropriate responsiveness rather than waiting until the next fiscal event, which is scheduled for the autumn. I turn to new clause 5, which would require a report to the House of Commons on the impact of the measure on UK public finances, the competitiveness of the UK freight and logistics sector and the contribution of the temporary VED rate to efficient supply chains, and whether the measure remains appropriate beyond the next 12 months. As always, taxes and reliefs will be looked at ahead of the next fiscal event in the context of the public finances. Consistent with the Chancellor’s approach, this is a targeted and time-limited intervention in response to the conflict in the middle east, in recognition of the key role that the road haulage sector plays in transporting goods—including food—across the UK and its disproportionate exposure to fuel costs. The Government will continue to monitor the situation and consider further action as and if that may be necessary. As on other measures, the Government have already published a tax impact and information note, and the costing for the measure will be subject to scrutiny by the Office for Budget Responsibility. Finally, the shadow Exchequer Secretary talked of this measure as a short-term fix. I hope he is aware of and has seen the impact of the long-term decisions that the Government have made over our time in office to ensure that we can have higher economic growth, as we have had, and higher living standards—rather than their falling by 2%, as they did in the previous Parliament, they have already risen so far by 2% in this Parliament—in part because we have brought back economic stability and had wages rising faster than inflation in every single month since we took office. That has supported stability in the economy which has delivered six interest rate cuts. We have made sure that we are increasing capital investment and that we work with the private sector to get growth up and to invest in our public services and important infrastructure. We have done that in a way, along with investing in our NHS, that has enabled us to manage the public finances well and get borrowing falling in every year of this forecast, with the deficit lower than the G7 average, which the previous Conservative Government never achieved, despite how much they talked about it. They talked a good game on the public finances, but they were never able to deliver that. I therefore ask the Committee to reject the new clause. For the reasons that I have set out, I urge hon. Members to reject the amendments tabled by the Opposition. I commend the clauses in this short and well-formed Bill to the Committee. Question put and agreed to. Clause 1 accordingly ordered to stand part of the Bill. Clauses 2 to 4 ordered to stand part of the Bill. New Clause 2 Approved mileage allowance payments: review of rate for care workers “(1) Within six months of the passing of this Act, the Chancellor of the Exchequer must lay before the House of Commons a review of the adequacy of the approved mileage allowance payment rate set under section 2 in respect of care workers using a personal vehicle in connection with their employment. (2) The review under subsection (1) must consider— (a) whether the rate of 55 pence per mile adequately reflects the costs incurred by paid care workers when travelling between the homes of those for whom they provide care; (b) the merits of setting a higher approved rate for paid care workers who are required to transport specialist equipment, medication or mobility aids in connection with their caring responsibilities; (c) the merits of setting a higher approved rate for paid care workers who make three or more separate care visits in a single day; and (d) the interaction between mileage reimbursement practices in the social care sector and the effective hourly rate received by paid care workers relative to the National Living Wage. (3) In preparing the review under subsection (1), the Chancellor of the Exchequer must consult— (a) representatives of paid care workers; (b) representatives of employers in the social care sector; and (c) such other persons as the Chancellor considers appropriate. (4) In this section “care worker” means a person employed to provide personal care to individuals in their own homes, whether employed directly or through a domiciliary care agency.” —(Daisy Cooper.) Brought up, and read the First time . Question put, That the clause be read a Second time.

• 24 Jun 2026 · Taxation (Energy and Vehicles) · Hansard source

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  The Chancellor has committed to doing what she can to support families and businesses to be responsive in a changing world and responsible in the national interest. The measures before the House assist the Government in that objective. The way that the current energy system works means that households and businesses pay more for their electricity when the gas price is high. The electricity generator levy already recoups some of the excess returns made by renewable generators when high gas prices push electricity prices over the current threshold of £82.61 per megawatt-hour. The Government have decided to increase the rate of the levy from 45% to 55% from 1 July. That will do two things: first, it will ensure that a large proportion of any exceptional revenues from high gas prices are passed back to the Government, providing a revenue stream so that money is available to support businesses and families with the impacts of the conflict in the middle east; and secondly, in the longer term it will support the new voluntary contracts for difference scheme, which was announced in April, by encouraging participation in the scheme. In March, the Government announced a review of mileage rates for employees using their own vehicle for work and the self-employed who use the simplified expenses rates. In recognition of the pressures facing drivers as a result of the effects of the Iran war, the Chancellor announced in May the first uprating of mileage rates in 15 years, backdated to April, to provide immediate support to both groups. Mileage rates will increase for 2026-27 from 45p to 55p for the first 10,000 miles, and then 25p thereafter, with effect from 6 April. That represents the largest ever increase to these mileage rates, benefiting around 2 million employees and 1 million self-employed individuals, and saving over £120 a year for a worker doing 6,000 business miles. It was a privilege recently to meet care workers and the Unison general secretary to hear directly about the difference that this uprating will make to those on the frontline. The general secretary said to me and the Chancellor that this measure is good news for people providing essential public services. It was an honour to meet those who work day in, day out looking after people across the country. I am glad that this measure will have a positive impact on those who do such vital work. Looking ahead, beyond 2026-27, the Government have already committed to a review of those rates and will set out further steps at the Budget. The third measure recognises the key role that the road haulage sector plays in transporting goods across the UK and its disproportionate exposure to fuel costs. The Government are introducing a 12-month holiday from vehicle excise duty for the majority of heavy goods vehicles, which will save a typical HGV £600 on top of the savings from fuel duty. Fuel costs make up a substantial proportion of HGV operating costs, and this action will help to prevent cost pressures from the Iran conflict spreading across the economy. The announcements on mileage rates and HGV VED were part of a wider package of measures announced in May, including on fuel duty. In total, the decisions taken since the 2024 general election to freeze fuel duty will save motorists 11p per litre, or £120 for the average car, £250 for the average van and over £2,000 for the average HGV, compared with the plans we inherited from the previous Government. This Government are taking action to support the economy at a time of global economic uncertainty following the Iran conflict. Our approach of targeting support at those groups who are hardest hit by the conflict will ensure that the measures we take are effective, while protecting the economy from the effects of reckless borrowing that took place under the previous Government.

• 24 Jun 2026 · Taxation (Energy and Vehicles) · Hansard source

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  I am not sure. I have been in the Chief Secretary’s office in the Treasury, and there are many pictures on the wall of the countless Chief Secretaries who served under the last Government—especially towards the end, what with all the chopping and changing. However, both the Liberal Democrats and the Conservatives had ample time to make more than the one change that was made in 2011. The hon. Member for North Bedfordshire asked why no change was made in the “above 10,000 miles” rate. We did of course consider that when developing the policy. A very significant proportion of those who drive for work drive less than 10,000 miles. As the hon. Gentleman pointed out, some will drive more, especially if they have long distances to drive or live in rural communities, but we thought that this approach—providing a significant 10p increase in the rate up to 10,000 miles while leaving the 25p rate unchanged—got the balance right between supporting people who need help right now and being fiscally responsible. The hon. Gentleman will know, and drivers will know, that the marginal cost of each extra mile driven will decline over time, because the up-front costs can be spread over more mileage. As for annual indexation, it is not the Government’s policy. I welcome the representation, but, again, that is not a policy that was pursued before. As he rightly observed, it would be a complicated process, given the volatility in petrol prices. I should, of course, mention to the Liberal Democrat spokesperson that I am from Witney, and Chris Hayter Transport, the haulage company, is based just behind the housing estate on which I grew up. It is a very good local business, and I am glad to know that it will benefit from this measure. I take the points raised about the challenges facing the haulage sector, but I hope that our temporary and targeted change will benefit that business and businesses across the country. Question put and agreed to. Income Tax (Mileage Amounts) Resolved , That— (1) In the table in each of— (a) section 230(2) of the Income Tax (Earnings and Pensions) Act 2003 (approved amount for mileage allowance payments), and (b) section 94F(2) of the Income Tax (Trading and Other Income) Act 2005 (appropriate mileage amount), for “45p” substitute “55p”. (2) In consequence of paragraph (1), in section 94F(3) of the Income Tax (Trading and Other Income) Act 2005, for “45p” substitute “55p”. (3) The amendments made by this Resolution have effect for the tax year 2026-27 and subsequent tax years. And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.— ( Dan Tomlinson.) Vehicle Excise Duty (Temporary Rates for Goods Vehicles) Resolved, That— (1) The Vehicle Excise and Registration Act 1994 has effect in relation to vehicle licences, other than trade licences, taken out in the period beginning with 1 July 2026 and ending with 30 June 2027 as follows. (2) Paragraph 9 of Schedule 1 to that Act (rates for rigid goods vehicles exceeding 3,500 kgs revenue weight) has effect in relation to goods vehicles to which sub-paragraph (1), (2)(b) or (3) of that paragraph applies and which are used in the course of a trade as if— (a) in sub-paragraph (1), for “shall be determined in accordance with” to the end there were substituted “and not exceeding 44,000 kgs is £1.”; (b) where sub-paragraph (2) applies in relation to rigid goods vehicles mentioned in paragraph (b) of that sub-paragraph, in that sub-paragraph for “basic goods vehicle rate” there were substituted “£1”; (c) in sub-paragraph (3), for “£1,703” there were substituted “£1”. (3) Paragraph 10 of that Schedule (rates for certain rigid goods vehicles exceeding 11,999 kgs) has effect in relation to goods vehicles to which sub-paragraph (1) of that paragraph applies and which are used in the course of a trade as if— (a) in sub-paragraph (3), for “to be determined in accordance with” to the end there were substituted “£1.”; (b) in sub-paragraph (7), for “£654” there were substituted “£1”. (4) Paragraph 11 of that Schedule (rates for tractive units exceeding 3,500 kgs) has effect in relation to goods vehicles to which sub-paragraph (1), (2)(b) or (3) of that paragraph applies and which are used in the course of a trade as if— (a) in sub-paragraph (1), for “shall be determined in accordance with” to the end there were substituted “and not exceeding 44,000 kgs is £1.”; (b) where sub-paragraph (2) applies in relation to tractive units mentioned in paragraph (b) of that sub-paragraph, in that sub-paragraph for “basic goods vehicle rate” there were substituted “£1”; (c) in sub-paragraph (3), for “£1,703” there were substituted “£1”. (5) Paragraph 11C of that Schedule (rate for certain tractive units exceeding 41,000 kgs but not exceeding 44,000 kgs) has effect in relation to goods vehicles to which that paragraph applies and which are used in the course of a trade as if for “£10” there were substituted “£1”. (6) Where subsection (2) of section 3 of that Act (6 month licences) applies in relation to a vehicle for which any of paragraphs (2) to (4) has effect, that subsection has effect as if, in paragraph (a), for “£50” there were substituted “£0”. (7) Article 3(1)(b) of the Vehicle Licences (Duration of First Licences and Rate of Duty) Order 1986 (S.I. 1986/1428) has effect in relation to vehicle licences, other than trade licences, taken out in the period beginning with 1 July 2026 and ending with 30 June 2027 for vehicles for which any of paragraphs (2) to (5) has effect as if for “£50” there were substituted “£0” And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.— (Dan Tomlinson.) Ordered , That a Bill be brought in upon the foregoing resolutions; That the Chairman of Ways and Means, the Prime Minister, the Chancellor of the Exchequer, Lucy Rigby, Rachel Blake, Dan Tomlinson and Torsten Bell do prepare and bring in the Bill. Taxation (Energy and Vehicles) Bill Presentation and First Reading Dan Tomlinson accordingly presented a Bill to increase the rate of electricity generator levy and mileage amounts relating to income tax and to provide for temporary rates of vehicle excise duty for goods vehicles. Bill read the First time; to be read a Second time tomorrow, and to be printed (Bill 103) with explanatory notes (Bill 103 - EN).

• 23 Jun 2026 · Business Rates · Hansard source

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  We have a tax on profits in the UK, which is corporation tax. In our corporate tax road map, we have committed to keeping that stable in this Parliament, rather than having it jump around as it did in the last one. It is important to have a broad tax base, so it is reasonable for business rates to continue to be—as they have been since the late 1980s—set in accordance with an estimate of the rents of properties. I do not think it would be right to change that.

• 28 Apr 2026 · Topical Questions · Hansard source

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  On business rates, the hon. Member will know that this Government inherited the plans that were set in train for an independent revaluation of properties to take place for the first time since the pandemic. It would not have been the right thing to do to delay that independent revaluation for those businesses who have seen their rates fall since the pandemic, so we went ahead with it, and we then put in £4.3 billion of support to limit the increases in bills that businesses would pay. Of course we keep all taxes under review, but we have for the first time put in a differential within the business rates system so that high street businesses face a lower tax rate—a lower multiplier—than the largest online giants.

• 28 Apr 2026 · Fuel Costs: Support for Motorists · Hansard source

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  My hon. Friend is right to say that we are seeing a continued uptake of electric vehicles—we saw that in March this year. More electric vehicles were purchased in March than in any month in British history, and we can see that take-up is continuing to increase. This Government are increasing and expanding the grants for those who want to buy an electric vehicle, and we are making progress on permitted development rights, so that those who do not have easy access to charging in their driveways can have easy and cheap access to on-street charging.

• 27 Apr 2026 · Draft Vaping Duty Stamps (Requirements, Reviews and Appeals) Regulations 2026 · Hansard source

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  I beg to move, That the Committee has considered the draft Vaping Duty Stamps (Requirements, Reviews and Appeals) Regulations 2026. It is a pleasure to serve under your chairship, Ms Vaz. The draft regulations make provision for when vaping products must and must not bear a duty stamp, and ensure that decisions made in relation to United Kingdom representatives are subject to rights of review and appeal. They do so by setting out the stamping requirements that will apply under the vaping duty stamps scheme, and by amending the Finance Act 1994 so that relevant decisions fall within the existing review and appeal framework. The draft regulations provide part of the detailed framework needed for the administration, control and enforcement of vaping products duty and the vaping duty stamps scheme. At the 2024 Budget, the Chancellor confirmed the structure and rate of vaping products duty; the new duty will be charged at a flat rate of £2.20 per 10 ml on all vaping liquid from 1 October 2026. Vaping duty stamps are the primary compliance mechanism for the new tax, requiring every duty-paid vaping product to carry a highly secure, scannable label. These stamps provide a visible and traceable confirmation that duty has been paid, enabling His Majesty’s Revenue and Customs and other agencies to assess compliance, and strengthening enforcement in a market with high risks of illicit activity. They also give retailers and consumers confidence that the products they are purchasing are legitimate. Let me summarise the three measures in the draft regulations. First, they set out when vaping products must bear a duty stamp. Under the draft regulations, vaping products produced or imported on or after 1 October 2026 must be stamped at or before the point at which they pass an excise duty point. Products produced or imported before 1 October 2026 must be stamped by 1 April 2027. Secondly, the draft regulations set out where the duty stamp requirement does not apply. They apply exceptions for products possessed by a private individual for that individual’s own use; products to be exported from the United Kingdom; products to be shipped or carried on a ship, aircraft or train as stores; products to be used in an export shop; and products that are afforded relief from excise duty. Thirdly, the draft regulations provide for reviews and appeals in relation to United Kingdom representatives in the vaping duty stamps scheme. They achieve this by amending the Finance Act 1994, so that decisions relating to UK representatives fall within the existing statutory review and appeal framework. This means that decisions made by HMRC in relation to such representatives—those acting on behalf of overseas businesses for duty stamps purposes—can be reviewed and, where appropriate, appealed in an independent tribunal. This is an important safeguard, as the vaping duty stamps scheme expressly provides a role for UK representatives where overseas manufacturers wish to supply to the UK market. I hope that members of the Committee will join me in supporting the draft regulations.

• 18 Mar 2026 · Fuel Duty · Hansard source

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  The EVED charge is on electric cars because they do not pay fuel duty. Petrol cars do pay fuel duty, which, because it is on a litre of petrol, is a charge that is determined by how much someone drives. The hon. Member for Brighton Pavilion (Siân Berry) made some good points about public transport. I congratulate her on getting through the speech after the very large number of interventions that she had to respond to—and she responded to them well. I point out that this Government are introducing the first rail fares freeze in 30 years and that we are investing £38 million to roll out 319 new zero emission buses across England—lots of good things. As ever, decisions on taxation will be taken at the appropriate time, based on the best evidence and with careful regard to the public finances. The Government will continue to take the right decisions, protecting the public finances and supporting families with the cost of living. The previous Government left us with the worst living standards stagnation in memory. A Reform Government would crash the economy just like Liz Truss did, with wild unfunded promises. The Greens would push up energy bills by blocking clean power. This Government reject the chaos offered by Opposition parties. We have an economic plan that is the right one for Britain. Our plan means that we are more prepared for this shock than otherwise, with borrowing falling by 1% of GDP last year, our power supply now less reliant on the gas rollercoaster, living standards rising, inflation falling, and the big and right decision to take £117 off annual energy bills in April yet to come. It is the right plan, and this Government will stick to it for the good of the British people and this great country that we all serve. Question put (Standing Order No. 31(2)), That the original words stand part of the Question.

• 18 Mar 2026 · Fuel Duty · Hansard source

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  My hon. Friend is right: the Opposition are totally on the wrong side of common-sense public opinion in this country. On the most important of tests, they have failed. He is also right to point out that the fuel duty increase is pencilled in for September, as the Chancellor set out in last year’s Budget. I think it is worth reminding the House that fuel duty right now is lower than it was in 12 of the 14 years of the Conservative Government. In 2010, 2011, 2012 and all the way up to 2022, fuel duty was higher than it is now. In the 2025 Budget, we extended the temporary 5p per litre cut in fuel duty until the end of August this year, and we cancelled the inflation-linked increase that had been planned for 2026-27. Taken together with decisions made since the 2024 Budget, the Government’s fuel duty freeze will save the average motorist more than £90 compared with the plans that we inherited. Conservative Members, who have made contributions in this debate, stood in the July 2024 general election on spending plans that would have had fuel duty increase by 5p— [Interruption.] Yes, it is true. Unless the Conservatives are disowning the official forecasts that were published before the general election and the manifesto on which they stood—which, by the way, did not mention plans for fuel duty—I think we are again discovering that there were further black holes in the Conservatives’ spending plans. Their plans, which were set out in the official forecast in the run-up to the general election, said that fuel duty would increase by 5p last year—by RPI last year—and then by RPI again this year. We have instead chosen to freeze fuel duty both last year and this year and to maintain the 5p cut until September of this year. The Liberal Democrat spokesperson, the hon. Member for Westmorland and Lonsdale (Tim Farron), and other Members made very important points about the impact of fuel price increases on those in rural communities. He will be aware, as I believe it applies to his constituency and to some of the others mentioned today, of the rural fuel duty relief scheme, which does provide a reduction to motorists in those parts of the country that are more rural. As I said in a Westminster Hall debate, which some in this Chamber attended, I am always happy to receive representations on whether that scheme should be widened. The hon. Member for Gordon and Buchan (Harriet Cross) asked about the electric vehicle excise duty change that will be introduced in the coming years, and whether it will be extended. No, it will not. The plan is as set out at the Budget last year. Government Members think that it is fair that all vehicles that contribute to the wear and tear on our roads should also contribute towards the repair costs and to the public finances, and they will do so at a lower rate of 3p rather than 6p, which was the average amount paid by those who pay fuel duty.

• 10 Mar 2026 · Northern Ireland Hospitality Sector: VAT · Hansard source

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  We have made sure to freeze fuel duty since we have been in office. That has saved the average driver 8p per litre at the pump, and it will rise to 11p when the increase does not go ahead in a few weeks’ time. If heating oil is an issue that affects the hon. Lady’s constituents, I hope she will be able to attend tomorrow’s meeting. We are looking very closely at this issue, and at the changes that we can see in oil and gas prices at the moment. As the former Chancellor of the Exchequer, the right hon. Member for Godalming and Ash (Sir Jeremy Hunt), said yesterday, it is too early to tell how things will pan out. We have seen significant increases, and today we have seen decreases. We will keep looking closely at what we can do.

• 3 Feb 2026 · Finance (No. 2) Bill (Sixth sitting) · Hansard source

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  I fully recognise the intention behind these proposals. Members on both sides of the Committee are rightly focused on how tax changes affect businesses of all sizes, across the economy and across the country. We need to make sure that we provide certainty and stability for businesses, which is what we are doing with our corporate tax road map. As the shadow Exchequer Secretary foreshadowed, however, we also need to make sure that we can raise revenue in a sustainable way to fund our public services, get borrowing down—as we do every year in this forecast—and make sure that the Government can hit our fiscal rules. As a result of some of the measures in the Bill, we intend on doing that with a headroom that is more than double what it was at the 2024 Budget. The Government recognise that it is vital to understand how tax measures impact businesses. We publish tax information and impact notes, which set out the impacts on the Exchequer, individuals, households, businesses and civil society organisations, looking particularly at the administrative and compliance burdens. We will continue to monitor this closely; we keep all of our tax policies under review. Given the existing processes and publications, the Government’s view is that these new clauses would largely duplicate work that is already undertaken and add unnecessary reporting burdens and costs. New clauses 33 and 35 should therefore be rejected as they are not needed to ensure a proper assessment of the impacts on businesses.

• 29 Jan 2026 · Finance (No. 2) Bill (Fourth sitting) · Hansard source

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  I will keep my remarks brief, if only to give the hon. Member for North West Norfolk more time to inform us of his opinions on this matter. Clause 89 makes changes to uprate vehicle excise duty rates for cars, vans and motorcycles in line with the retail prices index measure of inflation from 1 April 2026. New clause 17 would require the Chancellor to make a statement to the House on the impact of that 2026-27 increase to VED rates, but the increase announced in the Budget is in line with the retail prices index, meaning that rates will remain unchanged for vehicle owners in real terms by that metric. It is therefore the Government’s judgment that the new clause is unnecessary. I therefore commend clause 89 to the Committee, and recommend that new clause 17 be rejected.

• 29 Jan 2026 · Finance (No. 2) Bill (Fourth sitting) · Hansard source

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  In response to the shadow Minister’s question, the Government do consider the impact of each individual tax measure on businesses and consumers in the round with the others, at Budgets and in between them too. As a result, we have concluded that this is the right and proportionate way forward, to protect revenue and make sure that we can increase revenue in line with inflation, rather than beyond it. Question put and agreed to. Clause 89 accordingly ordered to stand part of the Bill. Clause 90 Vehicle excise duty for rigid goods vehicles without trailers and tractive units Question proposed, That the clause stand part of the Bill.

• 29 Jan 2026 · Finance (No. 2) Bill (Fourth sitting) · Hansard source

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  I am sorry to report to the Committee that when the Chancellor and I made the decision to increase the threshold ahead of the Budget, I was not aware of the representations that the hon. Member for North West Norfolk had made in last year’s Finance Bill Committee. If I am still in my role in the run-up to the Budget later in the year, of course I will bear in mind everything he has said today. I have already taken some notes that I will take back with me. The hon. Member is right to note the important role that hybrid vehicles play in the transition. Ultimately, however, to move towards our goal of net zero by 2050, we need to move to a fully clean vehicle fleet over the coming decades, so we want to particularly encourage fully electric vehicles. We will keep this measure under review; it is important that we do so. This has been an ask of the car manufacturers here in the UK that we want to support. I take the points from the hon. Member for Maidenhead about making sure that consumers can buy vehicles that are produced here in Britain. I hope that a change such as this, which shows the Government’s intent to support the electric vehicle transition, will be a consideration for vehicle manufacturers as they choose where to produce new EV cars in the years to come. Along with other measures that we set out in the Budget, this shows our intention to work alongside the industry to support that transition. The hon. Member for North West Norfolk raised a point about how high the supplement is. He said that many constituents in rural Norfolk, but also in north London, will find it very challenging to afford to buy a new car that costs between £40,000 and £50,000. That is true in lots of parts of the country, but as I am sure he is aware, it is important that we seek to encourage those who can afford such a car to do so, because they will then sell their cars on at a cheaper value that people may be able to afford. It supports the general health of the car market overall if we can increase the affordability of these—granted—relatively expensive vehicles. That is why the Government have brought forward this change: to support the transition and to reduce the cost of purchasing new vehicles within the £40,000 to £50,000 bracket. Question put and agreed to. Clause 94 accordingly ordered to stand part of the Bill. Clause 95 ordered to stand part of the Bill.

• 29 Jan 2026 · Finance (No. 2) Bill (Fourth sitting) · Hansard source

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  Clauses 90 to 93 will make changes to the vehicle excise duty rates for rigid goods vehicles without trailers and tractive units, the cab of an articulated lorry, rigid goods vehicles with trailers, vehicles with exceptional loads, and haulage vehicles other than showman’s vehicles. Clause 95 will make changes to uprate the heavy goods vehicle—HGV—levy. The registered keeper of a vehicle is responsible for paying VED. The rates depend on the vehicle’s revenue weight, axle configuration and Euro emissions status. The HGV levy is payable for both UK and foreign HGVs using UK roads. A reformed HGV levy was introduced in August 2023, which varies according to the vehicle’s weight and Euro emissions status. New clause 18 would require the Chancellor to make a statement to the House—in a similar way, I believe, to new clause 17 that we just discussed—on the increases to HGV vehicle excise duty under clauses 90 to 93, and the HGV road user levy under clause 95. Similarly, given that the uprating is in line with inflation and that rates will remain unchanged in real terms for vehicle owners, it is the Government’s view that the new clause is not therefore necessary, and I urge the Committee to reject it.

• 29 Jan 2026 · Finance (No. 2) Bill (Fourth sitting) · Hansard source

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  Over the months ahead, as a result of the action that this Government have taken to bring stability back to the economy, I look forward to seeing inflation return to 2% by the end of the year, as is forecast by the Bank of England. I thank the hon. Member for Maidenhead for bringing up the botched Brexit deal that the previous Government left us. Under the leadership of the Prime Minister and Ministers in the Cabinet Office and elsewhere in Government, we continue to work to reduce barriers to trade and deepen our relationship with our nearest trading partner. As the Minister responsible for customs and excise, I am always looking at what more we can do to support those who move goods across borders and trade with our partners in the EU. Question put and agreed to. Clause 90 accordingly ordered to stand part of the Bill. Clauses 91 to 93 ordered to stand part of the Bill. Clause 94 Vehicle excise duty: expensive car supplement Question proposed, That the clause stand part of the Bill.

• 29 Jan 2026 · Finance (No. 2) Bill (Fourth sitting) · Hansard source

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  It is a pleasure to speak under your chairship, Mrs Harris. I am very glad to see you in the Chair. Rather than running through these changes in detail, let me respond to some of the points that have been raised, because they are important and, in some cases, valid. As a tax Minister, I am not going to comment on the affairs of individual taxpayers, by which I mean individual businesses, but I will say that the exclusion from TOMS applied to several large private hire vehicle operators. Crucially, it ensured that they were subject to the same tax rules as everyone else. That is what this change is trying to do. Regarding any subsequent potential changes to the operation of business models that may or may not have taken place—hon. Members have mentioned some reports, but at this stage they are only reports—HM Revenue and Customs will always make an operationally independent assessment of whether a private hire vehicle operator is operating as an agent or, as it is sometimes called, a principal, and it will charge tax accordingly. If there are any implications—we do not know yet whether there will be—any costing update will flow into the forecast as usual.

• 29 Jan 2026 · Finance (No. 2) Bill (Fourth sitting) · Hansard source

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  I thank the Opposition for that warm welcome back after our break. Clause 96 sets the rates of air passenger duty for the year 2027-28, as announced at the Budget. The rates will take effect on 1 April 2027. Following previous increases to APD, the Government will uprate rates in line with RPI from 1 April 2027. As was previously announced, they will be rounded to the nearest penny, which constitutes a real-terms freeze. This will continue to make sure that airlines continue to make a fair contribution to the public finances, particularly given that tickets are VAT-free and aviation fuel incurs no duty. The Government expect these measures to have an impact on approximately 600 airlines and aircraft operators. New clause 20 would require the Chancellor to publish an assessment of the impact of changes to air passenger duty under clause 96 on the aviation industry, passengers, household finances at different income levels and the public finances. The air passenger duty national statistics on different APD rates administered by HMRC are published annually through the APD bulletin. The bulletin, which is updated annually, includes statistics and analysis on APD receipts up to the latest full month before its release, and airline passenger numbers one month behind that of duty receipts in the UK. New clause 20 is therefore unnecessary. New clause 32 would require travel operators liable to air passenger duty to ensure that, where a boarding pass is issued, the change in the level of air passenger duty made under clause 96 and charged in respect of the passenger’s journey is clearly stated on the boarding pass. Air passenger duty is charged to airlines on a per-passenger basis on departure from UK airports. Although airlines can pass the cost of the tax on to passengers, that is a commercial decision for them. I therefore commend clause 96 to the Committee, and encourage the Committee to reject new clauses 20 and 32.

• 29 Jan 2026 · Finance (No. 2) Bill (Third sitting) · Hansard source

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  I am grateful to the shadow Minister for giving me a chance to reiterate that the Government have set out—it is relatively unusual for a Government to do so—a corporate tax road map where we have made very specific commitments, which we have kept to, around maintaining the headline rate of corporation tax at the lowest rate in the G7. As with all other policies, however, we keep all taxes under review. It would not be right, particularly many months from the next Budget, for me—I was called a “low-ranking” Treasury Minister by the Daily Mail the other day—to comment or speculate on future tax measures. Question put and agreed to. Clause 56 accordingly ordered to stand part of the Bill. Schedule 11 agreed to. Clause 57 Collective money purchase schemes and Master Trust schemes

• 29 Jan 2026 · Finance (No. 2) Bill (Third sitting) · Hansard source

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  Clause 77 will make changes to ensure that the Motability scheme and other qualifying schemes provide value for money for the taxpayer while continuing to support disabled people. It will remove the VAT relief for top-up payments made to lease more expensive vehicles. Clause 78 ensures that insurance premium tax will apply at the standard rate of 12% to insurance contracts on the scheme. The Motability scheme is an important vehicle leasing scheme available to people receiving the enhanced Motability component of disability benefits such as the personal independence payment. The weekly Motability award covers the lease cost and a generous service package. If a chosen vehicle is more expensive, the customer pays a one-off top-up payment in advance of the three-year lease. The Motability scheme supports the independence of disabled people, but it benefits from generous tax breaks that are supporting provision beyond the scheme’s core objectives, such as the lease of luxury cars. To limit tax support for the most premium vehicles on the scheme, the Government have removed VAT reliefs on the one-off voluntary—I stress that they are voluntary—payments made to lease higher-cost vehicles. VAT reliefs on weekly lease costs covered by eligible disability benefits, and the VAT relief on vehicle resale, will remain in place. Additionally, ending the IPT exemption for most vehicles will bring the IPT treatment for qualifying vehicles’ leasing schemes in line with other commercial leasing firms. The tax changes will preserve the delivery of the core objective of the scheme, and Motability Operations Group has confirmed that, after the tax changes take effect, it will continue to offer a broad range of vehicles available without a top-up payment, meaning that customers will be able to lease a vehicle that meets their needs for the value of their eligible benefit. The changes made by clauses 77 and 78 will generate savings of more than £1 billion across the scorecard. I commend them to the Committee.

• 29 Jan 2026 · Finance (No. 2) Bill (Third sitting) · Hansard source

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  The Government are taking action to tackle those who attempt to bend or break the rules to avoid paying the tax that they owe. The clause introduces a new provision to address avoidance arrangements in certain very specific situations involving the creation of liabilities and related expenses for accounting purposes. The rule addresses certain arrangements that are designed to secure a tax advantage. The accounting and tax analysis in relation to when financial assets are derecognised or may continue to be recognised can be complex. In some cases, assets that are transferred to a securitisation vehicle may continue to be recognised for accounting purposes in the transferor’s accounts. This can potentially happen for commercial reasons. In certain circumstances, a liability may also be recognised for accounting purposes in connection with the underlying assets or otherwise in connection with the transfer. This liability is a non-derecognition liability. This new rule addresses scenarios where, as a result of tax-driven arrangements, a company seeks a tax deduction for expenses in connection with such a non-derecognition liability. HMRC considers that existing legislation already negates any UK tax advantage from these arrangements. However, introducing the new rule aims to deter such tax avoidance arrangements and secure receipts for the Exchequer that might otherwise be deferred through tax disputes. I therefore commend the clause to the Committee.

• 27 Jan 2026 · Topical Questions · Hansard source

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  We have extended the temporary 5p fuel duty cut until the end of August 2026, and rates will then gradually return to early 2022 levels. The planned increase in line with inflation will also not take place. That will save the average driver £49 next year, compared with previous plans.

• 19 Jan 2026 · Business Rates: Retail, Hospitality and Leisure · Hansard source

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  One of the challenges with the questions I am being asked by Opposition Members is that they seem to be suggesting that the Government should not have gone ahead with the post-pandemic revaluations. Those revaluations were set in train by the previous Government. I do not know about the hon. Member, but I think that, if businesses in his constituency or mine have seen a decrease in their rateable values since the pandemic, for whatever reason, it is right that the system is updated to reflect their post-pandemic values. That is what we have done. He cites a particular example. Of course there will be businesses that see increases in their rateable values, and that is precisely why we have stepped in, with the Chancellor announcing £4.3 billion of transitional support at the Budget last year.