Tax Collection and Management (Wales) Act 2016 and the Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017 (Consequential Amendments) Order 2018 — House of Lords, 2018-11-06
Topic: Mixed Topics
James Younger (Conservative, Centre-right): My Lords, the draft instrument we are considering will make changes to UK legislation arising from the National Assembly for Wales’s Tax Collection and Management (Wales) Act 2016 and the Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017. Perhaps it would be helpful if I first give some background to this order As noble Lords will recall, the Wales Act 2014 implemented the vast majority of the recommendations in the Silk commission’s first report to devolve tax and borrowing powers to the National Assembly for Wales and Welsh Ministers. This included powers to replace stamp duty land tax and landfill tax in Wales, as well as the creation of Welsh rates of income tax. The Wales Act 2014 represented a significant moment in Welsh devolution, enabling the Assembly to legislate to establish the first specifically Welsh taxes in almost 800 years—a land transaction tax and a landfill disposals tax—and to establish the Welsh Revenue Authority, or WRA, to collect and manage these new devolved taxes. I am pleased to note the positive collaboration that has taken place between the UK and Welsh Governments to manage the transition to these devolved taxes, which came into effect from 1 April. The Government continue to report annually on this work, and the fourth report on the implementation of the finance provisions in the Wales Act 2014 will be presented to Parliament next month Noble Lords will no doubt recognise that 1 April was also significant as the date on which the new reserved powers model of devolution for Wales, put in place by the Wales Act 2017, came into force. The Wales Act 2017 further demonstrated the Government’s firm commitment to devolution. Alongside the new model of devolution, the Act devolved further powers that can make a real difference to people’s lives in areas such as elections, transport and natural resources This order, made under powers in Section 150 of the Government of Wales Act 2006, makes consequential provisions on the establishment of the Welsh Revenue Authority and the creation of land transaction tax. It has four provisions. Article 2 inserts the new WRA into Schedule 1 to the House of Commons Disqualification Act 1975, so as to disqualify the chairperson and non-executive members of the WRA from being Members of the House of Commons. This puts the WRA on the same footing as HMRC in this respect. Following the devolution of powers over Assembly elections in the Wales Act 2017, it is of course a matter for the Assembly as to whether the chairperson and non-executive members should also be disqualified from being members of the National Assembly for Wales Article 3 inserts the Welsh Revenue Authority into the list of public bodies at Part 6 of Schedule 1 to the Freedom of Information Act 2000, thereby providing a right of access to information held by the WRA. In doing so, the order brings the WRA within the definition of Welsh public authority under that Act Article 4 of the order inserts a reference to the Welsh Revenue Authority in the schedule to the Public Interest Disclosure (Prescribed Persons) Order 2014, ensuring the same protection for whistleblowers who contact the WRA under the Employment Rights Act 1996 as that afforded to whistleblowers who assist HMRC Finally, Article 5 inserts a reference to land transaction tax to Regulation 45 of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017. Under those regulations, HMRC is required to maintain a register of the beneficial owners of certain trusts. This amendment provides that these reporting requirements apply to trusts that are liable to pay land transaction tax in Wales This order again demonstrates the Government’s continued commitment to work with the Welsh Government to deliver the effective implementation of devolved taxes in Wales. In assuming tax and borrowing powers, devolution in Wales has truly come of age as the devolved institutions become responsible not just for how money is spent in Wales, but how it is raised. Following the implementation of Welsh rates of income tax, the Assembly will be responsible for raising more than £2 billion in tax revenue, around 15% of the Welsh block grant. These fiscal powers, together with the powers devolved through the Wales Act 2017 and the fiscal framework, pave the way for the Assembly to become a fully-fledged Welsh Parliament. I beg to move.