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Mr. John Redwood (Wokingham): I have declared my interests in the Register of Members' Interests, but I guess that that is not strictly relevant as we are assured that the intention of the proposal is not to change or affect the law.
There have been some diversions of opinion on the Opposition Benches, and I should like to pull those strands together. We are basically agreed. My right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) thinks that the proposal could pose a substantial threat, but I hope that he will reflect on the matter a little. I believe that the Paymaster General is being honest when she says that the intention is not to change the law, that such changes would normally be made through a Finance Bill, and that the Government are trying to simplify the way in which the law is phrased without making serious tax changes. Although my right hon. Friend is understandably suspicious, because sometimes Governments do things about which they have not told us, he may be a little too worried. I suspect that the Minister is trying to keep the law as it is.
Mr. Redwood: I was saying that, on this issue, I believe that the Paymaster General is speaking honestly and honourably, as a Member of this House should strive to do, but that we have on occasions felt rather misled by the Government. I do not think that the Minister has any intention to mislead us. The Government have been trying to come up with a system that might meet the cross-party spirit. We want to simplify our tax laws, but if the Government wanted to change tax rates, introduce more stealth taxes or do all the other things that the Paymaster General's boss, the Chancellor of the Exchequer, is so good at doing and has done on so many occasions, we would still want proper, robust debate and different procedure.
Dawn Primarolo: Just to clarify matters for the right hon. Gentleman, the Joint Committee will be checking that the tax law rewrite committee, which has already done all the work on simplification of the Capital Allowances Bill, has not changed the underlying policy of the law--in line with his comments and those of the right hon. Member for Bromley and Chislehurst (Mr. Forth).
Mr. Redwood: I quite agree; that is the point that I am trying to make. The task is difficult because the law is so complicated. I am sure that the Minister does not intend that the law will be changed as a result of the process, but the experts undertaking the rewrite and the Joint Committee, which is the eyes and ears of this House and the other place, may well find that almost impossible. Achieving the objective of simplification will require so many changes that it will be very difficult to ensure that the law is not changed.
My worry is about inadvertent change. Because we have extremely complicated legislation--Ministers will always say that that is for good reasons, but I am not sure that I am entirely persuaded of that--the job of determining it often falls to tax accountants, lawyers, experts and specialists. Very often, important issues are resolved not in the House of Commons but in courts of law. We know that lawyers, paid very large fees for their expertise, intelligence and high training in such fields, are very good on behalf of their clients at highlighting any slight shift in the weight of words, in punctuation or in the way in which a sentence appears in the overall text.
It would be possible for the Joint Committee to nod through a Bill that had been drafted with the best of motives. The word of the law would then be slightly different--presumably, that is the whole point of the simplification exercise. The Government could be embarrassed by the courts construing a law revised under the procedure in a way that had not been expected. Far be it from me to want to protect the Government from embarrassment, but I want certainty and clarity in tax matters. Inadvertently, the House, the Joint Committee and the proposed procedure would have failed because a change in the law would have occurred.
Such inadvertent change would be even worse: as there had been no debate about changing the law, as is normal, and Ministers had not intended to change the incidence of tax, people would be without warning. They might not notice that anything important had changed; they might have said to themselves that they need not read the new version of the law because it implements exactly the same policy as the Budget or Finance Act they had previously studied. However, because the words had changed, there had been a court case and lawyers and a judge had construed the law differently, such people might suddenly discover an unexpected tax liability.
Mr. Jack: In preparing his remarks for the debate, my right hon. Friend will no doubt have looked at the Capital Allowances Bill, which the Committee is to consider, and come to his own conclusions. Will he give me an illustration of the concern that he thinks might cause difficulty for the Committee, as he has described?
Mr. Redwood: The point of my argument is no, I could not do so because we are talking about very complicated and detailed issues for which one needs to be a tax lawyer or specialist concentrating on such matters on behalf of one's client. Those who are paid big sums of money will of course look very carefully at a Bill such as the Capital Allowances Bill for evidence of any change. I am sure that my right hon. Friend is right that those drafting the Bill will have tried to avoid that, but he surely at least concedes the theoretical possibility that one day a change of words--he will agree that the words must be changed in order to simplify--could trigger such a court case, much expense and even a change in interpretation.
Mr. Burnett: Perhaps the right hon. Gentleman had in mind clause 153(1), concerning whether a ship is a qualifying ship or not. It is not if it is used "for sport or recreation". Perhaps a ship could be used partly for one and partly for the other. Might not that be the sort of discussion in the Joint Committee or the House?
Mr. Redwood: The hon. Gentleman makes a powerful point on which I had not alighted. The example he gives could be only one of many cases in which the form of words is changed from the underlying legislation to the new and allegedly more simple legislation. Wherever a change occurs, lawyers and accountants will pore over it, and although I happily accept that, in 99 per cent. of such cases, they will conclude--reluctantly--that, because the underlying intention is clear, they cannot bring a case or advise their client to pay good fees for bringing the change before the courts, there might be cases into which clever lawyers and accountants will probe and delve. We know that at times the courts construe tax legislation in a
When the Paymaster General rises to allay some of the fears expressed by my right hon. and hon. Friends and me, I hope that she will explain how long she thinks the process will take in relation to a Bill such as the one that we are shortly to discuss, and how much money might be spent on