This week saw the completion of the passage of the Finance Bill at Westminster. Although bills that have failed to complete their passage prior to ‘prorogation’ and the State Opening quite often fall, the Finance Bill is one of those bills which was, for obvious reasons, brought swiftly back to life.
A UK Government has the opportunity to bring forward many amendments to its Finance Bill throughout its passage, whether that’s to correct minor drafting errors in the original legislation or to adapt to changing circumstances. However, the opportunities for the opposition to put forward amendments, far less secure any changes outside of the Committee stage of a bill, are quite limited.
I was very happy to back – and speak in favour of – a proposed new clause to the bill which would have required the UK Government to publish an assessment of the effects of a global minimum corporation tax rate. This was in part a response to the news that that the G7 nations, or at least some of them, are close to an agreement on minimum rates of global corporate taxation and the leadership which has been shown by the Biden Administration on encouraging such agreement.
A global minimum tax rate for companies would reduce the opportunities for large corporations such as Amazon to minimise their tax liabilities by funnelling revenues through low tax jurisdictions. That would be good not only for the exchequer but also for competition, by ensuring a much more level playing field for smaller local businesses, especially in the retail sector.
Additionally, I backed amendments that would have ensured that companies benefitting from planned tax allowances should first have to demonstrate a record of co-operation with tax authorities, as well as respecting the workplace rights of their employees.
I also spoke on ‘Freeports’. While some MPs have taken quite a dim view of Freeports, I’ve tried to take a more balanced view. It stands to reason that offering exemptions for Freeports when it comes to business rates, National Insurance payments and the application of customs duties would be attractive to businesses. However, it’s also important to make sure that any jobs and tax revenues which result from Freeports are in fact new, and not simply being displaced from elsewhere.
We also have to make sure that Freeports don’t permit companies within their scope to gain an advantage by undercutting the employment rights and environmental obligations that companies on the other side of the wire are expected to uphold. That’s why the Scottish Government has sought to build a ‘Greenport’ model which embraces all the potential benefits of freeports, while also ensuring that the principles of fair work and carbon reduction are placed at their heart.
During the debate, I strongly encouraged the Financial Secretary Treasury Minister Jesse Norman to make progress on this. I know that the Scottish Government stands ready, equipped with the newly refreshed mandate received from the Scottish people earlier this month, to press ahead as soon as the UK Government is also willing to do so.