I beg to move, That the Bill be now read the Third time.
I thank all Members for the valuable insight that they have provided throughout the Bill’s passage so far. Their expert scrutiny has gone a long way towards ensuring that it reaches the statute book in good shape.
Indeed, my officials suggested that I describe it as being “in good NIC”—[Hon. Members: “Oh dear!”]—but I thought better of it.
Such has been the level of scrutiny and insight contributed by Members that I shall give the House only a brief reminder of the five main measures in the Bill. The first is a measure to help both to remove barriers to growth for businesses and to equip the United Kingdom to compete in the global race. In this year’s Budget, my right hon. Friend the Chancellor of the Exchequer announced the creation of a new £2,000 employment allowance, which will come into effect on 6 April 2014. The objective is to help businesses with the cost of employing their staff. The allowance will help thousands of small businesses that aspire to grow, and is set to benefit more than 1 million employers.
The second measure was introduced this afternoon. In last week’s autumn statement, the Chancellor announced our proposal, in effect, to abolish employers’ secondary class 1 national insurance contributions on the earnings of any employee under the age of 21 up to the level of the upper earnings limit on 6 April 2015. That will substantially reduce the fiscal burden of secondary class 1 NICs, and thus support youth employment. As the figures in the autumn statement made clear, we estimate that about 340,000 employers could benefit to the tune of more than £450 million in 2015-16, and that the figure could rise to about £530 million in 2018-19. This is another measure that will make it cheaper and easier for businesses to employ young people, and I am sure that it will be welcomed, as a latecomer, by Members in all parts of the House. I appreciate the support that it has received this afternoon.
Thirdly, we have introduced provisions relating to the general anti-abuse rule, or GAAR. We announced in last year’s Budget that we had accepted the recommendations of the Aaronson review, and would introduce a GAAR targeted at abusive tax avoidance schemes. The GAAR was introduced in part 5 of the Finance Act 2013, and has been in force since July. The Bill ensures that it will apply to NICs. While the extension to NICs is a relatively simple measure, it is an important step because it makes it harder for individuals and businesses to avoid paying what they owe.
The fourth main provision concerns oil and gas workers on the UK continental shelf. In this year’s Budget, the Chancellor announced that the Government would strengthen legislation in respect of offshore employment intermediaries. The measure, which has been subject to consultation, is specifically intended to address the non-payment of employers’ national insurance in the oil and gas industry, involving the placement of employers of oil and gas workers who are working on the UK continental shelf outside the United Kingdom.
Fifth and finally, the Bill contains provisions relating to HMRC’s partnership review. The Government propose two sets of changes. The first is intended to address an issue that can arise from the interaction of the alternative investment fund managers directive and the existing partnership tax rules. The second reclassifies certain limited liability partnership members as employed earners for tax and national insurance purposes to tackle the disguising of employment relationships through LLPs. Together, those changes will ensure that the correct NIC consequences follow the planned changes in the taxation of partnerships.
The Bill is both important and necessary. I am sure that all Members will recognise that every one of the measures that I have described will either make employing people easier, or will make avoiding taxes harder. The Bill will be good for growth, good for jobs, and hence good for the United Kingdom. On that basis, I commend it wholeheartedly to the House.
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