Finance Bill — Clause 78 — Report on Impact of Reform of Taxation on Fossil Fuels for Generating Electricity — 5 Jul 2011 at 20:45

The majority of MPs voted against requiring a report on the expected impact of changes before removing the exemption from climate change levy (CCL) for fossil fuels used to generate electricity and introducing new taxes, to be known as carbon price support rates, to be charged on fossil fuels. The aim of the change was to encourage investment in low-carbon electricity^[1].

MPs were considering the Finance Bill^[2].

Clause 78^[3] of the Finance Bill stated:

• Schedule 20 contains provision for and in connection with the charging of climate change levy on supplies of commodities to be used in producing electricity.

The rejected amendment would have added the following additional subclauses to clause 78:

• Amendment 12, page 45, line 5, at end insert—
• ‘(2) The Schedule shall not come into force except as specified in subsection (3) below.
• (3) The Chancellor of the Exchequer shall bring the Schedule into force by order within six months of the passing of this Act.
• (4) A statutory instrument containing an order under subsection (3) shall be accompanied by a report which details—
• (a) any effective subsidy provided to, or additional profits accruing to, operators of existing and new nuclear power stations as a result of the provisions in the Schedule;
• (b) the immediate impact of the provisions in the Schedule on consumers and on fuel poverty;
• (c) the immediate impact of the provisions in the Schedule on energy-using manufacturing industries and on employment in those industries;
• (d) the expected effect of the provisions in the Schedule on investment in new renewable power generation and on investment in new nuclear power generation;
• (e) the measures that the Chancellor intends to adopt in a future Finance Bill in order to recoup any effective subsidy to or additional profits accruing to the nuclear industry as a result of the Schedule; and
• (f) how the monies raised by those measures will be used to mitigate the immediate impact of the Schedule on consumers and on manufacturing industries and to encourage green investment.’.

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• [1] Explanatory notes to the Finance Bill dated 1 April 2011
• [2] Parliament's webpage on the Finance Bill, now the Finance Act 2011
• [3] Clause 78 of the Finance Bill

Debate in Parliament | Source |