The government is today publishing the Finance Bill, which will enact tax measures announced in last week’s Budget and in the March 2011 Budget.
The Bill includes measures which maintain the government’s strategy to reduce the deficit, while promoting far-reaching tax reform, supporting growth and rewarding work:
- increasing the tax-free personal allowance to £8,105 from April 2012
- reducing the additional rate of income tax to 45%; from April 2013
- broadening the tax base while simplifying the tax system
- tackling over £1bn of tax avoidance and evasion
- and cutting the corporation tax rate to 24% this year and 23% in 2013
The government has set about improving the way that tax policy is developed. As set out in our 2010 document Tax policy making, a new approach, we have committed to unprecedented levels of consultation and scrutiny. This Bill demonstrates this commitment. The measures in this Bill have, in the vast majority of cases, been through the proper tax policy making process:
- over 75% of the clauses in this year’s Bill announced at Budget 2011
- over 400 pages of legislation for technical consultation were published in December 2011
- and the Government has received over 450 comments
Since then we have met again with interested parties, considered their views and reacted to them. For example, the changes that we have made to the new Controlled Foreign Companies regime are the result of a year-long consultation to ensure we achieve the best policy outcome.
The Exchequer Secretary to the Treasury, David Gauke MP, said:
This year’s Finance Bill shows just how committed the coalition government is to rewarding work, simplifying the tax system and tackling the nation’s debts. The measures in this Bill will create a tax system which supports a strong economy and promotes a fair society. In other words, a tax system that works for Britain.
Notes for editors
The Bill is formally known as Finance (No. 4) Bill as it is the fourth Finance Bill of the current Parliamentary session. On Royal Assent it will become Finance Act 2012.
More detailed Explanatory Notes on clauses are available from Stationery Office bookshops and also on HM Treasury website.
Further details on the Bill will be published on the Parliament website (opens in new browser window) and HM Treasury and HM Revenue & Customs websites as the Bill progresses through Parliament.
The new approach to tax policy making: a response to the consultation was published on 9 December 2010.
The Explanatory Notes are published on this website.