§ 'Schedule (Capital transfer tax: maintenance funds) to this Act shall have effect.'.—[The Solicitor-General.]
§ Brought up, and read the First time.
Mr. Deputy Speaker
With this it will be convenient to take Government amendments Nos. 84 to 86, 96, 97, 103, 162, 109, 110, 114, 115, 117, 118, 138 to 140 and 154.
§ The Solicitor-General
The House will appreciate that we have now moved on to capital transfer tax. In Committee, the Government undertook to consider a number of points about the application of the new discretionary trust regime to heritage maintenance funds. I am happy to say that we have been able to meet all those points and propose to do so by means of the schedule inserted in the Bill through the combined effect of new clause 46 and amendment No. 154.
The schedule will bring together in one place all the relevant provisions, which will no doubt be most convenient for all concerned. First, it repeats clause 108 of the Bill. Secondly, it incorporates certain technical matters relating to the charges to tax on property leaving maintenance funds and the exemptions from that charge designed to prevent abuse. Thirdly, it provides for additional relief when property in a maintenance fund is paid out to the person who settles the fund or to his or her spouse. That effectively reproduces an exemption available in existing law. Finally, it provides detailed rules for calculating the rate of charge to tax on property withdrawn from a maintenance fund—again, to prevent any possibility of abuse. The last two items are included in fulfilment of specific commitments that I made to my hon. Friend the Member for Enfield, North (Mr. Eggar).
The provisions that I have described take the place of clause 109 which, together with clause 108, will be removed from the Bill. The other amendments in this group are consequential on the introduction of the new clause and schedule.
§ Mr. Eggar
First, I thank my hon. and learned Friend the Solicitor-General for being the most generous of all the Ministers who attended the Standing Committee. He has, I believe, given no fewer than seven concessions, which are greatly welcomed by the National Heritage Memorial Fund.
I have no wish to detain the House or to appear in any way churlish, but I am not entirely clear as to the reason for paragraph 8(8) and (9) of amendment No. 154. It would perhaps be better if I put the specific points to my hon. and learned Friend at length in writing so that he may have a chance to reflect on them. I am not clear why no time limit was placed on the power of the Inland Revenue Board to choose which of two or more settlors to refer back 705 to. Under section 80 of the Finance Act 1976 there was a time limit of 30 years. I shall, however, write to my hon. and learned Friend, and perhaps we may continue our discussion at some other time and place.
§ Mr. Robert Sheldon
The new clause and the lengthy new schedule take a great deal of digesting, but those who sat through the debates in Committee had to learn to make use of and accommodate digestion as best they could.
My only comment at this stage on the maintenance funds lies in paragraph 7 of the schedule which deals with the various rates over 40 complete successive quarters. I have examined it carefully in the light of our discussions in Committee, and it is probably as good a solution as we can achieve at this stage. There is no final point at which one can draw the line beneath all these matters. With that proviso, I welcome the new clause and the schedule.
§ The Solicitor-General
I thank the right hon. Member for Ashton-under-Lyne (Mr. Sheldon) for his welcome, and I thank my hon. Friend the Member for Enfield, North (Mr. Eggar) for his contribution. I am sure that it would be for the convenience of the House if my hon. Friend were to raise his highly technical point in correspondence. It would be appreciated if he could do it briefly.
§ Question put and agreed to.
§ Clause read a Second time, and added to the Bill.