Treasury secretary Stephen Timms has confirmed there will be a Finance Bill before the election, but it could do more harm than good if the government rushes through complex tax legislation, according to representatives from two key accountancy bodies, the ICAEW and the CIOT.
At a debate at the House of Lords, ‘Taxing our way out?’, hosted by the Smith Institute and the Oxford University Centre for Business Taxation, the Treasury’s financial secretary Stephen Timms confirmed that there would “certainly be a Finance Bill before the election”, but admitted that due to the timing, debate around the Bill would be “somewhat curtailed”.
David Gauke, shadow exchequer secretary to the Treasury told attendees to expect “ten or so clauses”, followed by a more detailed Finance Bill later in the year after the election.
The CIOT predicts that if the 24 March Budget is followed by the announcement of a 6 May general election, a Finance Bill will need to be rushed through in almost certainly a single day.
Following Timms’ announcement, Ian Young, technical manager at the ICAEW’s tax faculty, warned against rushing through the Bill, saying the government should learn from mistakes made back in 2005 when a reduced debating period resulted in controversial legislation being passed without sufficient consultation beforehand.
John Whiting, CIOT’s tax policy director echoed these sentiments and a statement from the CIOT followed later in the day urging the chancellor to include “only measures essentials to maintain the government’s revenue raising capacity, such as renewing the provision of income tax”. It added that other measures should be left until a post-election Finance Bill where they can be scrutinised at greater length.
“Good tax law requires close examination and detailed scrutiny, from parliamentarians and from outside experts. In particular this is to ensure that the legislation does not have unintended negative consequences. A Finance Bill rushed through all its stages in a single day does not allow for this – especially in the final days of a parliament when most MPs minds will, understandably, be elsewhere”, added CIOT president Andrew Hubbard.