Finance Bill — Decline Second Reading — 1 Apr 2014 at 19:33

The majority of MPs voted to increase the personal income tax allowance, to reduce corporation tax, and to give a greater tax incentive to companies investing in assets, as well as to support other measures in the Finance Bill.

The majority of MPs voted in favour of giving the Finance Bill^[1] a second reading, approving the key principles of the Bill and allowing it to continue on its path to becoming law.

Key elements of the Bill:

• An increase in the personal income tax allowance from £9,440 to £10,000 for 2014-15.
• A decrease in the threshold for starting to pay higher rate income tax from £32,011 to £31,865.
• Main rate of Corporation Tax reduced to 21% from April 2014. The Small Profits rate is set at 20%.
• An increase in the "annual investment allowance", the amount spent on investing assets in a year which companies (or self-employed individuals) can deduct from their profits prior to the calculation of corporation tax due on the profits was increased to £500,000, whereas previously it had been £250,000.
• Cut in general duty on beer by 1 penny a pint, but with an increase for higher strength, >5% alcohol beers. Duties are increased on wines.
• Freezing the Air Passenger Duty applying to trips of under 2000 miles, and increasing other rates of Air Passenger Duty, but reducing the number of bands from four to two.

The motion rejected by the majority of MPs in this vote was:

• That this House
• declines to give the Finance (No. 2) Bill a Second Reading because it fails to address the cost-of-living crisis which will see working people worse off at the end of this Parliament than at the beginning;
• because while working people are £1,600 a year worse off it prioritises a tax cut for millionaires of on average £100,000;
• because it offers a marriage tax allowance which will help only a third of married couples, rather than a 10 pence starting rate of tax which would help millions more families; and
• because it fails to set out measures to tackle rising energy bills, get young people into work, boost housing supply and help families with childcare costs within this Parliament.

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• [1] Parliament's webpage on the Finance Bill 2014

Debate in Parliament | Source |