Wales Bill- Clause 11 — Referendum on Devolving Welsh Income Tax Rate Setting — Independent Setting of Each Rate — 30 Apr 2014 at 20:30

The majority of MPs voted for any referendum on devolving Welsh income tax rate setting to the National Assembly for Wales to be on allowing an off-set from the rates set by the UK Parliament rather than allowing each Welsh rate to be set independently.

MPs were considering the Wales Bill^[1]. The amendment rejected in this vote was:

• Amendment 1, page 16, line 20, leave out from ‘Wales’ to end and add
• ‘where a Welsh rate resolution specifies more than one rate of income tax.'

This would have affected Clause 11^[2] of the Bill, titled : "Referendum about commencement of income tax provisions", which enables a referendum to be held prior to the introduction of different income tax rates for Wales, set by the National Assembly for Wales, within parameters set out by Parliament.

In particular, had the amendment been passed, subsection 1 would have been changed from:

• Her Majesty may by Order in Council cause a referendum to be held throughout Wales about whether the income tax provisions should come into force.

to

• Her Majesty may by Order in Council cause a referendum to be held throughout Wales where a Welsh rate resolution specifies more than one rate of income tax

Clause 8 of the Bill introduces a new section 116D into the Government of Wales Act 2006 subsection 4 of which says:

• A Welsh rate resolution may specify only one rate.

During the debate Jonathan Edwards MP stated:^[3]

• The purpose of amendment 1 is to ensure that the referendum is on the ability of Wales to vary each income tax band individually, rather than the lockstep that is proposed in the Bill.

Edwards went on to refer to further planned amendments which "would alter the Bill so that the lockstep is removed from the income tax power, giving Wales the ability to vary income tax band rates independently of each other"

As it stood at the time of the vote, and remained following the rejection of the amendment clause 9 of the Bill introduced provisions describing how each Welsh rate of income tax would be set^[4], with each rate being set at a level the same number of percentage points different from the rates set in the UK budget.

==

• [1] Parliament's webpage on the Wales Bill
• [2] Clause 11 of the Wales Bill as at the time of the vote
• [3] Jonathan Edwards MP, (Carmarthen East and Dinefwr, Plaid Cymru), House of Commons, 30 April 2014
• [4] Proposed new clause 6B of Income Tax Act 2007 on calculation of the "The Welsh basic, higher and additional rates"

Debate in Parliament | Source |