Budget Resolution Votes

On 6 November 2024, the House met to vote on budget resolutions. At the end of the final day of the Budget debate, the House is asked to agree the Budget resolutions. These are also known as ways and means resolutions. The resolutions are specific proposals for taxation and allow the House to legislate for tax changes in the Finance Bill. Some resolutions have immediate legal effect, although this is only provisional. The Finance Bill gives the changes permanent legal effect.

These are the results:

• Capital gains tax (the main rates) – The resolution changes some Capital Gains Tax (CGT) rates, increasing them to 18% or 24% on profits made from selling most things, like stocks or valuables, but not on a person’s main home. It also says these new rates start on October 30, 2024, and sets rules about how the tax applies to sales contracts made before that date.  Ayes: 401 Noes: 120

• Capital gains tax (business asset disposal relief) – This resolution allows for raising a specific tax rate on certain business-related gains, with the change possibly set to happen in a future year. It also lets the government include this tax change in a Finance Bill, even if that’s usually not done for future tax rates. Ayes: 400 Noes: 120

• Capital gains tax (investors’ relief)- This resolution allows for two tax changes: raising a certain tax rate on specific investment gains and lowering the tax-free amount for these gains. These changes could take effect in a future year and be included in a Finance Bill, even if that’s not typically allowed for future changes.  Ayes: 400 Noes: 122

• Energy (oil and gas) profits levy (increase in rate) – This resolution raises the tax rate on oil and gas profits from 35% to 38%, starting November 1, 2024. For companies with accounting periods that span this date, the period is split into two parts for tax calculations, and payments are adjusted to reflect the new rate. Ayes: 455 Noes: 125

• Energy (oil and gas) profits levy (relief for investment expenditure)- This resolution changes the rules for tax relief on oil and gas profits by focusing relief on investments in decarbonization and oil production activities. Starting 1 November 2024, companies can claim an extra 66% of qualifying decarbonization-related investment costs but cannot include general operating or leasing costs for additional relief.  Ayes: 454 Noes: 124

• Energy (oil and gas) profits levy (period for which levy has effect)- This resolution proposes to extend the oil and gas profits tax until March 31, 2030, allowing this change to be included in a Finance Bill even if that’s not usually allowed.  Ayes: 450 Noes: 120

• Value added tax (private school fees):Changes VAT rules for private schools, making certain educational services they provide subject to VAT from January 1, 2025. Private schools will have to charge VAT on general education, vocational training, and related boarding services, with exemptions for special education needs and nursery classes, and English as a foreign language. This adjustment allows exceptions based on the type of service and aims to standardize tax practices across private education services. Ayes: 383 Noes: 184

• Stamp duty land tax (additional dwellings: purchases before 1 April 2025) – This Resolution updates the Stamp Duty Land Tax (SDLT) rates for certain residential property transactions involving additional dwellings, effective from October 31, 2024, until April 1, 2025. These rates apply to transactions finalized after October 31, 2024, except for contracts agreed upon before that date, unless certain changes occur post-October 31, such as contract variations or assignments. The Resolution also aligns the Finance Act 2003 provisions to ensure these SDLT changes apply to the relevant contracts and conveyances.  Ayes: 378 Noes: 116

• Stamp duty land tax (additional dwellings: purchases on or after 1 April 2025)- This Resolution proposes an amendment to paragraph 1(2) of Schedule 4ZA of the Finance Act 2003, which would increase the rates of Stamp Duty Land Tax (SDLT) outlined in that section.  Ayes: 373 Noes: 110

• Rates of alcohol duty -This Resolution proposes changes to alcohol duty, specifically amending the Finance (No. 2) Act 2023, which affects how alcohol is taxed based on its strength and type. These amendments are scheduled to take effect on 1 February 2025. The Resolution declares that it is in the public interest for these amendments to have statutory effect under the Provisional Collection of Taxes Act 1968, allowing them to be implemented before the full legislation is passed. Ayes: 371 Noes: 77