§ Mr. Hannamasked the Chancellor of the Exchequer when he proposes to issue the revised draft clauses dealing with the capital gains tax position of acquisitions by beneficiaries from overseas trusts originally contained in clause 61 of the Finance Bill 1983.
§ Mr. MooreWe have been reviewing the need for these measures in the light of the representations which were made on the original proposals. This review has covered not only these particular measures but also the underlying provisions of section 29A of the Capital Gains Tax Act 1979 on which they are based.
In the light of this review we have decided to relax the restrictions on when the market value rules can be applied for CGT purposes. In future we intend that these rules should apply to acquisitions from overseas residents and other "excluded persons" on the same basis as they apply to other acquisitions. We shall, however, keep this area under review in case there is any exploitation of this provision.
Section 29A will be amended so that it applies only where an asset is acquired without there being a corresponding disposal and there is no consideration, or the value of the consideration is less than the market value of the asset. The references in subsections (2) and (3) to disposals by a person who is an "excluded person", broadly a person who is not liable to CGT, will be withdrawn.
We propose to introduce the necessary legislation in the 1984 Finance Bill, and this will apply to acquisitions and disposals on or after 6 April 1983. In the light of this decision, it is no longer necessary to proceed with the provisions contained in clause 61 of the original 1983 Finance Bill.