§ '.—(1) In determining—
- (a) for the purposes of inheritance tax, income tax or capital gains tax where a person is domiciled at any time on or after 6th April 1996, or
- (b) for the purposes of section 267(1)(a) of the Inheritance Tax Act 1984 (deemed UK domicile for three years after ceasing to be so domiciled) where a person was domiciled at any time on or after 6th April 1993,
there shall be disregarded any relevant action taken by that person (whether before, on or after that date) in connection with electoral rights.
§ (2) Relevant action is taken by a person in connection with electoral rights where—
- (a) he does anything with a view to, or in connection with, being registered as an overseas elector; or
- (b) when registered as an overseas elector, he votes in any election at which he is entitled to vote by virtue of being so registered.
§ (3) For the purposes of this section, a person is registered as an overseas elector if he is—
- (a) registered in any register mentioned in section 12(1) of the Representation of the People Act 1983 (right to be registered of persons entitled to vote at parliamentary elections) on account of any entitlement to vote
1107 conferred on him by section 1 of the Representation of the People Act 1985 (extension of parliamentary franchise to certain non-resident British citizens); or
- (b) registered under section 3 of that Act of 1985 (certain non-resident peers entitled to vote at European Parliamentary elections).
§ (4) Nothing in subsection (1) above prevents regard being had, in determining the domicile of a person at any time, to any relevant action taken by him in connection with electoral rights if—
- (a) his domicile at that time falls to be determined for the purpose of ascertaining his or any other person's liability to any of the taxes mentioned in subsection (1)(a) above; and
- (b) the person whose liability is being ascertained wishes regard to be had to that action;
and a person's domicile determined in accordance with any such wishes shall be taken to have been so determined for the purpose only of ascertaining the liability in question.'.—[Mr. David Hunt.]
§ Brought up, and read the First time.
§ Mr. David Hunt
I beg to move, That the clause be read a Second time.
I should like to thank my hon. Friend the Financial Secretary for taking such an interest in this matter and for helping to ensure that the new clause is technically workable.
The history of this matter is that legislation on overseas electors has always had all-party support. I believe that all parties have run up against a difficulty, however, because there is some uncertainty about whether registering to vote and then voting might have an effect on an individual's tax position. A person's domicile is relevant in establishing certain tax liabilities—for example, inheritance tax in the case of non-residence. I feel strongly that there must be no unnecessary disincentives to people exercising their democratic right wherever in the world they may live. There should also be no uncertainty about any possible financial consequences of registering to vote and then voting.
My new clause would, of course, apply to all voters. I believe that it is non-partisan and I hope that the Government and the Opposition will accept it. The United States has a comparable rule. When a United States citizen who lives abroad registers to vote in federal elections, it is clearly stated in the law of the United States that that in no way affects that individual's residence or domicile status for federal, state or local tax purposes.
Finally, I am encouraged in my belief that the new clause will be accepted by the Government and the Opposition by the news that, last month, the Opposition launched their campaign to win overseas voter registration. I pay tribute to the fact that there are a number of individuals in the Labour party who have gone out to win over support abroad. I understand that the Opposition's launch mentioned that Los Angeles is one of their most active centres. Well, good luck to them. Perhaps it is appropriate that the film star world should be in the lead in what we believe to be a rather cosmetic new Labour party.
The initiative was launched by the deputy leader of the Labour party and one of its foreign affairs spokesmen under the title, "Wish you were here". The main centres of Labour activity will be Spain, Australia, Hong Kong, Brussels, Rome, New York and Washington DC. I therefore hope that my new clause will gain support from the Opposition and the 1108 Government. It is important that everyone considering whether he should vote and whether he should register to be entitled to vote should not be subject to any uncertainty. People should certainly not fear that that democratic act might have a detrimental effect on their tax liabilities.
§ Mr. Mike O'Brien
Whereas the American colonies in 1774 cried, "No taxation without representation," it seems that certain rich Tory overseas voters are now demanding representation without taxation.
I hate to say it, but new clause 9, proposed by the right hon. Member for Wirral, West (Mr. Hunt), who is held in some respect in the House, has all the hallmarks of a cynical amendment motivated by the self-interest of the Tory party. It seeks to reduce the evidential weight attached to registering to vote in determining whether a person is domiciled in this country.
Does citizenship not carry with it any responsibilities for Tories any more? Does patriotism and duty to others mean nothing? Is the right hon. Gentleman saying that seeking to vote—to influence the future of the country—and being represented in Parliament does not carry with it any duty to that country and its other citizens? No one says that people must pay taxes to vote, nor do we want unnecessary barriers to voting, but the rich should not get special tax privileges to encourage them to vote.
With opportunities to vote come responsibilities of caring about one's country and fellow citizens. Accepting that registration to vote shows a commitment to one's country. It can be evidence of domicile. In each case, that evidence will have a different weight, depending on the other circumstances of the individual, but it is right that registration should have some weight and show some degree of commitment to one's country.
Seeking representation in Parliament, although seeking to avoid making a proper contribution to taxation, is not the way in which to show patriotism. Let people who vote accept our laws. Let them not seek the special privileges that the new clause would confer. With the benefit of the vote comes the burden of citizenship. With the right to a voice in Parliament comes a responsibility of commitment to one's fellow citizens.
Some of the people who would benefit from the new clause are extremely wealthy tax exiles. Some of them may be Tories, perhaps even making contributions to the Tory party. I know that the Tories have been desperately trying to fill their coffers with overseas donations. Now it seems that some seek to give people who seek to evade their responsibilities on tax the right to do so and still vote. Registration to vote should be evidence of domicile and possible liability to tax.
Cynical as, in many ways, the new clause is, I doubt whether the Tory party will benefit all that it imagines from it. Many voters of all sorts, including those overseas, are now turning to new Labour, so I suspect that, in terms of votes, the right hon. Gentleman may be hoist with his own petard.
Let no one say that we tried to stop people from voting. We will not force a Division, although others may decide to, but nor can we, in all conscience, 1109 support this change in the law. There is a certain tackiness in the new clause that ill befits the right hon. Member for Wirral, West, who, as I said, has had a high reputation in the House. I regret that he has proposed it. I suspect that he did so out of party loyalty, which has its place. I therefore cast no slight on the respected right hon. Gentleman, but I hope that he will withdraw the new clause. If the Minister decides to support it, the people will judge the Government's criteria for law-making. They will know the Government's standards. That is why they will vote against them at the next general election.
§ Mr. Jack
I am tempted to ask, "Has the hon. Member for North Warwickshire (Mr. O'Brien) finished?" because that was the most amazing outburst on a modest proposal made by my right hon. Friend the Member for Wirral, West (Mr. Hunt), whose face shows the reaction that must be abroad in the House.
The hon. Member for North Warwickshire told us, first, that the Opposition will not vote against the new clause, so I suppose that that will be an abstention against democracy, as they have put it. He then asked my right hon. Friend to withdraw the new clause. It sounds like the Opposition want a good each-way bet.
I suspect that my right hon. Friend starts from the same position as me in this. When I came into my job as Financial Secretary, I received letters from people asking what their position was. We in the Treasury have done our best to write to people who want to exercise their democratic rights, conferred on them by the House, but, clearly, letters of advice showing that, effectively, registering to vote would not corrupt their tax position in relation to domicile was not enough for them.
Therefore, my right hon. Friend is right to introduce the new clause. He has put the matter beyond doubt, because domicile is not a tax concept, but one of general law that is used for many other purposes—for example, the validity of a marriage and the effect of a marriage on property rights and legitimacy.
Broadly, a person is domiciled in the country where they have their permanent home. Those are the types of test that, effectively, influence matters when tax considerations must be considered. The new clause says simply that registering to vote does not change anything in relation to domicile. I hope that, by reading out that brief paragraph, I have put on record some of the factors that must be taken into account in adjudging, as I said, the context of general law.
I was delighted that my right hon. Friend referred to an extract, which I presume was from a newspaper, showing that hon. Members on both sides of the House are attempting to woo our respective supporters if they are outside the United Kingdom. There may be doubts in the minds of some of the supporters of the hon. Member for North Warwickshire on this matter. Given his testimony to democracy, it would have been a sensible and simple move to put this matter beyond doubt in the clear and unequivocal terms that my right hon. Friend proposed.
Which way people vote, wherever in the world they exercise that vote, is a matter for influence in the normal course of electioneering. The new clause has been tabled on a non-partisan basis to enable all people who wish to 1110 exercise the democratic rights conferred on them by the House to do so without doubt in relation domicile and tax. I commend my right hon. Friend's new clause to the House.
§ Question put and agreed to.
§ Clause read a Second time, and added to the Bill.