Overview

The Finance (No. 3) Bill is a comprehensive piece of UK legislation that makes numerous amendments to existing tax laws, introduces a new carbon emissions tax, and addresses various administrative and enforcement matters. It aims to update tax legislation, improve tax avoidance measures and revenue collection, and implement a new carbon tax.

Description

This bill covers a broad range of tax changes affecting both direct and indirect taxes. Key aspects include:

• Direct Taxes: Amendments to income tax rates, allowances, and limits; changes to the tax treatment of employment benefits (cars, vans, workplace charging); alterations to capital gains tax (CGT) rules, particularly concerning non-UK residents and disposals of UK land; and adjustments to corporation tax, including rules on controlled foreign companies, diverted profits tax, and group relief.
• Other Taxes: Modifications to stamp duty land tax (SDLT), including relief for first-time buyers and higher rates for additional dwellings; changes to stamp duty reserve tax (SDRT); adjustments to value-added tax (VAT) and excise duties (alcohol, tobacco, vehicle duties); and amendments to air passenger duty, gaming duty, landfill tax, and the soft drinks industry levy.
• Carbon Emissions Tax: Introduces a new carbon emissions tax on regulated installations, with provisions for assessment, payment, collection, enforcement, and related administrative matters.
• Administration and Enforcement: Changes to time limits for assessments and tax recovery, particularly for offshore matters; provisions for security deposits in certain circumstances; measures relating to the resolution of double taxation disputes and international tax enforcement; and the handling of voluntary tax returns.
• Miscellaneous: Amendments regarding regulatory capital securities and hybrid capital instruments; minor amendments due to EU withdrawal (subject to conditions); provisions for reviews of the impact of anti-avoidance measures and the effectiveness of various tax provisions.

Government Spending

The bill's impact on government spending is complex and depends on the success of its revenue-raising and tax avoidance measures. The introduction of the carbon emissions tax is expected to generate significant revenue, while changes to allowances and reliefs could lead to either increased or decreased spending, depending on their effect on tax revenues. Specific figures are not readily available in the provided text.

Groups Affected

• Individuals: Income tax, CGT, inheritance tax, and SDLT changes will affect individuals' tax liabilities, potentially offering some relief (first-time buyers) or increasing taxes (additional dwellings).
• Companies: Corporation tax, CGT, SDLT, and the carbon emissions tax will impact businesses, particularly those operating in specific sectors or with international dealings. Changes to group relief and capital allowances also affect companies.
• Charities: Amendments to the tax treatment of charities could alter their financial situations.
• Financial Institutions: The bill includes specific provisions relating to financial institutions in resolution.
• Oil Companies: Changes to oil taxation, including transferable tax history (TTH), will directly impact the oil sector.
• Regulated Installations: The new carbon emissions tax will directly affect businesses and entities operating regulated installations.

Powered by nyModel