House of Lords (Members’ Taxation Status) Bill [HL]

My Lords, I say first to the noble Lord, Lord Oakeshott, that, like the noble Lord, Lord Strathclyde, I have been suffering some withdrawal symptoms, since I think that we have to go back as far as last March to find ourselves last being able to debate a subject of keen interest to a number of us; namely, reform of your Lordships' House. I think that we can now look forward to spending many happy Fridays in your Lordships' House debating these matters, as well as, no doubt, the Bill of the noble Lord, Lord Steel, when he eventually returns from his cruise. This is not the first time that we have debated this matter. Indeed, this morning we have been treated to a fascinating debate. My noble friend Lord Lea gave a very stirring speech, and the analysis of the noble Lord, Lord Selsdon, of the Liberal Democrats as a collection of new boys was certainly interesting. As I fast approach receipt of my bus pass, I rather enjoyed his description. When the noble Lord, Lord Oakeshott, introduced a very similar Bill on this matter in March last year, he set out a simple principle, that, "““if you pass laws for British people, you pay taxes like British people””.—[Official Report, 14/3/08; col. 1711.]" That has been summed up very simply as no representation without taxation—the noble Lord, Lord Wallace, repeated that. The Government cannot and would not wish to argue with that principle. I support what the noble Lord, Lord Goodhart, said about the commitment of Members to your Lordships' House. Paying taxes is an important way in which Members of both Houses of this Parliament demonstrate a commitment to the country that they serve through their parliamentary work. As is customary, the Government do not seek to impede the progress of a Private Member’s Bill through your Lordships' House, but, equally, it would be useful if I set out some of their reservations about the details of its provisions. The Government are fully entitled to bring to the House those reservations and to ask that the Bill be given extensive scrutiny, without in any way detracting from our support of the no-representation-without-taxation principle. A number of noble Lords kindly mentioned the well ordered White Paper on reform of your Lordships' House which was published last summer. It was informed by the extensive on those matters. Let me come to some of the details of the Bill. The noble Lords, Lord Goodhart and Lord Selsdon, as well as the noble Baroness, Lady Gardner, illustrated the complexity of matters around domicile status. I remind noble Lords of a commitment that the Government made in last year’s Budget, which undertook not to substantially revise or revisit rules on residence and domicile in this Parliament and the next. We stand by that commitment; the Budget’s measures on residence and domicile strike the right balance between helping to maintain the competitiveness of the UK economy and providing a tax system in which everyone pays their fair share. A number of noble Lords have commented on the financial challenge facing this country; I should have thought that the stability and balance to which I have referred was ever more important in those circumstances. The stability that we have committed to in rules governing domicile help the UK, and will continue to help the UK, to be an attractive destination for talent and investment in our economy. A number of technical points were raised, and it is with some trepidation that I provide the House with information, although it is appropriate that I do so. On the £30,000 charge for access to remittance basis, my understanding is that non-domiciles are not forced to access the remittance basis; it is their choice whether to apply for access to that tax status. Non-domiciles who access the remittance basis for more than seven out of the last 10 years must then pay £30,000 to continue to access the remittance basis or move on to the arising basis. These provisions and others in the 2008 Budget statement strike the right balance between asking non-domiciles to pay a fairer share as they stay in the UK for longer and maintaining the UK economy as an attractive place to invest.