§ Mr. Raymond Fletcher
asked the Chancellor of the Exchequer what representations he has received complaining about the retrospective nature of the stop-loss provisions in Clause 58 of the Finance Bill; and what action he proposes to take in consequence.
§ Mr. Joel Barnett
Under many share incentive schemes, where the right to stop-loss protection was acquired before 27th March 1974, its implementation cannot give rise to a benefit chargeable under Clause 58 until 1980. This is because waivers of loans on which the interest is eligible for relief are exempted from tax under paragraph 2 of Schedule 8. I accept, however, that there is a good case for removing entirely from the scope of Clause 58 the implementation of stop-loss protection under schemes in which the shares and rights were acquired before 6th April 1976; and a Government amendment to this effect will be moved in Standing Committee. This will mean that paragraph 2 of Schedule 8 343W becomes otiose in relation to loans waived in the cousre of stop-loss protection; and since there is no good reason for exempting other types of loan waiver, an amendment will be moved to withdraw this paragraph.