Guidance

Notes on resolutions: Spring Finance Bill 2023

Published 15 March 2023

These notes do not provide an explanation in the case of a resolution that simply authorises the Spring Finance Bill 2023 to make provision falling within the description set out in the resolution.

Accordingly, the notes contain explanations of only the following resolutions:

1. Income tax (charge)

Provides for income tax to be charged in the 2023 to 2024 tax year.

2. Income tax (main rates)

Provides for the main rates of income tax in the 2023 to 2024 tax year.

3. Income tax (default and savings rate)

Provides for the default and savings rates of income tax for the 2023 to 2024 tax year.

4. Income tax (starting rate limit for savings)

Provides for the starting rate limit for savings for the 2023 to 2024 tax year to remain at £5,000.

16. Company share option plans

Provides for changes, with effect from 6 April 2023, to the Company Share Option Plan rules set out in Schedule 4 to the Income Tax (Earnings and Pensions) Act 2003.

17. Enterprise management incentives

Provides for changes, with effect from 6 April 2023, to the enterprise management incentives rules within Schedule 5 of the Income Tax (Earnings and Pensions) Act 2003.

33. Chargeable gains (separated spouses and civil partners)

Provides for changes, with effect from 6 April 2023, to the capital gains tax treatment for transfers of assets between spouses and civil partners who are in the process of separating and no longer living together.

39. Stamp duty land tax (transaction funded with the assistance of a subsidy)

Provides for an amendment to section 71 of the Finance Act 2003, with effect from 15 March 2023, so that certain acquisitions by registered providers of social housing that are funded with the assistance of a grant under section 31 of the Local Government Act 2003 are exempted from stamp duty land tax.

44. Fuel duties (excepted machines)

Provides for minor amendments, with effect from 15 March 2023, to the Hydrocarbon Oil Duties Act 1979 to adjust restrictions on entitlement to use rebated diesel and rebated biofuels.

46. Rates of tobacco products duty

Provides for changes, with effect from 6pm on 15 March 2023, to the rates of excise duty on tobacco products and to the level of minimum excise tax on cigarettes and also provides for consequential changes to the simplified calculation contained in the Travellers’ Allowances Order 1994.

47. Soft drinks industry levy (flavour concentrates)

Brings into scope of the soft drinks industry levy, with effect from 1 April 2023, liquid flavour concentrates used in fountain (dispensing) machines that combine added sugar with the concentrate when the soft drink is dispensed to produce a soft drink with at least 5g of sugars per 100ml.

48. Air passenger duty (bands and rates)

Provides for the introduction, with effect from 1 April 2023, of a new domestic band and ultra long-haul band for the purposes of air passenger duty and for changes to the rates of the duty and to the list of territories.

49. Rates of vehicle excise duty

Provides for amendments, with effect from 1 April 2023, to the rates of vehicle excise duty in Parts 1 to 2 of Schedule 1 to the Vehicle Excise and Registration Act 1994

50. Heavy goods vehicle (HGV) road user levy

Provides for reforms to the HGV road user levy, with effect from 1 August 2023, following the end of the levy suspension period.

51. Rates of landfill tax

Provides for increasing the rates of landfill tax with effect from 1 April 2023.

53. Rate of plastic packaging tax

Provides for increasing the rates of plastic packaging tax with effect from 1 April 2023.

57. Late payment interest (value added tax)

Provides for amendments to Finance Act 2009 on late payment interest, with effect from 15 March 2023, to:

• change the way late payment interest applies to instalments payable under the VAT annual accounting scheme
• make the start date of late payment interest the day HMRC paid or credited the money, in cases where VAT is due after an excess payment or credit by HMRC

65. Charities (value added tax etc) and 66. Charities (stamp duty)

Provide for changes to restrict charitable tax reliefs to UK charities with effect from 15 March 2023.

Territorial extent and application in the UK

In the view of HM Government, there are only five of the Spring Finance Bill 2023 resolutions that do not apply to the whole of the UK.

The resolutions that do not apply to the whole of the United Kingdom relate to:

• the main rates of income tax (resolution 2)
• social security payments (resolution 21)
• stamp duty land tax (transaction funded with the assistance of a subsidy) (resolution 39)
• the rates of landfill tax (resolution 55)
• licensing authorities (requirements to give or obtain tax information) (resolution 64)

Resolution 2 sets the main rates of income tax for the tax year 2023 to 2024. The non-savings, non-dividend income of a UK resident individual who is not a Scottish taxpayer or Welsh taxpayer is charged at these main rates. Furthermore, although the non-savings, non-dividend income of a Welsh taxpayer is charged at the Welsh basic, higher and additional rates those Welsh rates are determined in part by reference to the main rates of income tax. But the non-savings, non-dividend income of a Scottish taxpayer is charged at Scottish rates which are set by the Scottish Parliament alone.

Resolution 21 authorises provision to be made about social security benefits arising under devolved legislation in Scotland, Wales or Northern Ireland.

Resolution 39 authorises provision to be made in relation to stamp duty land tax. Stamp duty land tax is charged only on the acquisition of an interest in land in England or Northern Ireland (see sections 42(1), 43(1) and 48(1) of the Finance Act 2003). Legislative competence to introduce a corresponding tax in relation to interests in land in Wales was conferred on the National Assembly for Wales by section 116L of the Government of Wales Act 2006 (inserted by section 15 of the Wales Act 2014) and that competence has been exercised with the enactment of the Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017. Legislative competence to introduce a corresponding tax in relation to interests in land in Scotland was conferred on the Scottish Parliament by section 80I of the Scotland Act 1998 (inserted by section 28(1) of the Scotland Act 2012) and that competence has been exercised with the enactment of the Land and Buildings Transaction Tax (Scotland) Act 2013.

Resolution 51 increases the rates of landfill tax. Landfill tax is charged on taxable disposals made in England or Northern Ireland (see section 40(1) of the Finance Act 1996). Legislative competence to introduce a corresponding tax in relation to disposals to landfill made in Wales was conferred on the National Assembly for Wales by section 116N of the Government of Wales Act 2006 (inserted by section 18 of the Wales Act 2014) and that competence has been exercised with the enactment of the Landfill Disposals Tax (Wales) Act 2017. Legislative competence to introduce a corresponding tax in relation to disposal to landfill made in Scotland was conferred on the Scottish Parliament by section 80K of the Scotland Act 1998 (inserted by section 30 of the Scotland Act 2012) and that competence has been exercised with the enactment of the Landfill Tax (Scotland) Act 2014.

Resolution 55 authorises provision to be made in relation to the designation of areas in Great Britain for the purposes of Parts 2 and 2A of the Capital Allowances Act 2001, and, where the area is in England, for the purposes of Part 4 of the Finance Act 2003 (stamp duty land tax).

Resolution 64 authorises the making of provision requiring licensing authorities, when licensing certain activities, to give or obtain information relating to tax compliance. This affects licensing regimes applying in Scotland and Northern Ireland.