As expected, a lot of the more complex measures have been dropped from the Bill.
Finance Bill 2017 completed its passage through the House of Commons and the House of Lords this week, on an accelerated timetable due to the upcoming general election, and received Royal Assent on 27 April 2017. As many had anticipated, a lot of the more complex measures have been dropped from the Bill after negotiations with the Opposition.
The measures removed include:
The Chartered Institute of Taxation have published a full list of all the measures cut and remaining in the Bill.
Some of the items removed from the Bill, including the legislation on the new corporate interest restriction and corporation tax losses, were originally due to come into effect at the beginning of April – so what will become of these measures? Well, that very much depends on the result of the election.
During the Parliamentary debate on the Bill Jane Ellison, Financial Secretary to the Treasury, said that “there has been no policy change” and “the Government will legislate for the remaining provisions at the earliest opportunity, at the start of the new Parliament”. Therefore, if the Conservatives win the election, this would suggest that the dropped measures will reappear quickly in a summer Finance Bill and the commencement dates will remain unchanged. However, until we see that Finance Bill the position remains uncertain.
As many of the measures dropped from the Bill are revenue-raising, even if the Conservatives do not form the next Government, we are still likely to see many of them introduced, albeit possibly in an amended form, depending on the new governing party’s policies. However, it is difficult to predict what changes would be made and whether the commencement dates would be revised.
So what should affected taxpayers do in light of this uncertainty? It would appear prudent to assume that the majority of the dropped legislation will still come into effect on the original dates as envisaged when the draft legislation was first published in Finance Bill 2017, and in a similar form, so we would suggest that taxpayers continue to prepare accordingly. It is hoped that the delay will allow HMRC to work with parliamentary draftspeople to iron out the remaining problems in the draft legislation. We would recommend that readers continue to submit comments to HMRC even though any response will be limited due to the restrictions of purdah in advance of the election.
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