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Lords amendment: No. 61, in page 34, line 19, at end insert—
("(0 A) After subsection (5) of that section there shall be inserted the following subsection—
(6) For the purposes of section 3 above regulations may make provision for treating as remuneration derived from an earner's employment any amount on which the earner is, by virtue of any provision of sections 140A to 140H of the 1988 Act, chargeable to income tax under Schedule E in respect of an acquisition of shares or an interest in shares."")
§ Mr. DenhamI beg to move, That this House doth agree with the Lords in the said amendment.
Mr. Deputy SpeakerWith this, it will be convenient to discuss Lords amendments Nos. 62, 63, 93 and 94. I should inform the House that Lords amendment No. 61 involves privilege.
§ Mr. DenhamThe amendments enable us to mirror, in national insurance, changes to the income tax treatment of shares carrying a risk of forfeiture and of convertible shares, as announced by my right hon. Friend the Chancellor of the Exchequer in his Budget.
The amendments provide for regulations to treat as earnings any amount on which the earner is chargeable to income tax under the provisions of sections 140A to 140H of the Income and Corporation Taxes Act 1988. That would allow for regulations to treat as earnings, for national insurance, gains derived from share ownership taxable under provisions to be introduced in the Finance Bill. The Finance Bill changes give business legislative certainty about the tax position. Similar changes are needed for national insurance purposes.
Part of our aim of modernising national insurance is that, where it is sensible to do so, national insurance rules should be aligned with income tax rules. It is important that national insurance rules keep in step with changes to income tax so that business is not faced with the burden of administering two sets of rules for the same type of remuneration. The amendments provide the most practical way in which to mirror in national insurance legislation the income tax changes in the Finance Bill, and I commend them to the House.
§ Lords amendment agreed to [Special Entry].
§ Lords amendments Nos. 62 and 63 agreed to.