House of Commons Library

Finance (No.2) Bill 2016/17

Published Wednesday, April 26, 2017

Following the 2017 Budget on 8 March 2017, the Government published the Finance (No.2) Bill 2016/17 on 20 March 2017. The Bill received a Second Reading in the House of Commons chamber on 18 April 2017. The sponsoring Member was Jane Ellison. Due to the timing of the Dissolution of the House, prior to the General Election, the remaining stages of the Bill are to be taken on 25 April.

Each year the Chancellor of the Exchequer presents the Budget, which contains all the tax measures for the year ahead. Traditionally the Budget has been in March, prior to the start of the tax year on 6 April.  The statutory provisions to give effect to these tax measures are set out in a single Bill: the annual Finance Bill.  In 2011 the Coalition Government reformed the Parliamentary timetable, moving the Queen’s Speech and the beginning of the annual session to the spring.  In turn provision was made to allow for the Finance Bill to be carried over from one session to the next to ensure that this reform did not substantially reduce the amount of time available for the Bill’s scrutiny.

It has been the practice in recent years for Chancellors to make tax announcements twice a year, using the Pre-Budget Report or Autumn Statement as a second fiscal event. In his Autumn Statement on 23 November 2016 the Chancellor Philip Hammond announced that from autumn 2017 the Government would present a single autumn Budget, to allow for greater Parliamentary scrutiny of Budget measures ahead of their implementation. For more details see, The Budget and the annual Finance Bill, Commons Library briefing CBP813, 13 April 2017.

Mr Hammond presented the last Spring Budget on 8 March 2017. The Budget report - HC 1025 - and associated documents are collated on  Among these documents three key sources are:

Following the Spring 2017 Budget, the Finance (No.2) Bill 2016/17 was published on 20 March 2017. The explanatory notes to the Bill are available on HMRC collates links to supporting documents on the Bill on its site.

Generally selected clauses from the Bill are debated by the Committee of the Whole House over two days at the start of the Bill’s Committee stage. The selection of clauses is set out in a programme motion, generally presented at the conclusion of the Second Reading debate. However, following the Prime Minister's announcement, on 18 April, of the Government's intention to call a General Election on 8 June, the House completed all of the remaining stages of the Bill in the Commons on Tuesday 25 April (HC Deb cc1013-59). With cross-party support the Government removed a series of clauses from the Bill, with the intention of legislating for these at the start of the new Parliament (for a list see, Votes & Proceedings, 25 April 2017).

Although the Bill received a Second Reading on 18 April, the programme motion, as set out in the Order Paper, was not moved (Votes and Proceedings, 18 April 2017). 

It is long-standing practice for there not to be a single impact assessment on the Bill; as noted, HMRC have published tax information & impact notes on individual Budget measures. Similarly, given the scale and scope of the annual Finance Bill, the Library does not publish a single paper on the Bill, but briefing material relating to the clauses that were initially specified in the Government's programme motion has been published:

Making Tax Digital, CBP7949, 20 April 2017

Tax avoidance: recent developments, CBP7948, 22 April 2017

Tax avoidance: a General Anti-Abuse Rule, CBP6265, 14 April 2017

Tax avoidance: a General Anti-Avoidance Rule - background history (1997-2010), CBP2956, 13 April 2017

The Soft Drinks Industry Levy, CBP7876, 12 April 2017

Alcohol taxation and the pub trade, CBP1373, 6 April 2017

Personal service companies: recent debate, CBP5976, 4 April 2017

Insurance Premium Tax, CBP1425, 3 April 2017

In addition to this material, Commons Briefing Papers have been published discussing the context for the Budget (CBP 7913, 3 March 2017), and providing a summary of the measures announced (CBP 7919, 17 March 2017). In the latter case this has been updated following the Chancellor’s statement on 15 March that the Government would not proceed with an increase in the rates of Class 4 NICs that had been announced in the Budget (HC Deb 15 March 2017 cc420-1; HM Treasury, Letter from the Chancellor to the Chair of the Treasury Select Committee, 15 March 2017).


Commons Debate packs CDP-2017-0114

Author: Antony Seely

Topic: Taxation

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