Clause 36 - Health service bodies: exemptions

Part of Finance Bill – in a Public Bill Committee am 2:30 pm ar 4 Mehefin 2013.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Photo of David Gauke David Gauke The Exchequer Secretary 2:30, 4 Mehefin 2013

As we have heard, the clause makes changes to ensure that certain NHS bodies are exempt from corporation tax. I shall provide hon. Members with some brief background to the clause.

The Health and Social Care Bill announced an extensive reorganisation of the structure of the NHS. Among other things, it created new bodies to take over responsibility for commissioning health care. As separate corporate bodies, they would be liable to pay corporation tax. The Health and Social Care Bill also changed the status of two existing special health authorities, making them non-departmental public bodies. Although those two bodies continue to provide the same services as previously, their change in status now makes them liable to corporation tax. The clause exempts all relevant bodies from corporation tax, ensuring that their treatment is consistent with that of all other health service bodies, as well as with the treatment of their predecessor bodies.

The clause provides an exemption from corporation tax for clinical commissioning groups and for three NHS bodies: the NHS Commissioning Board, the Health and Social Care Information Centre and the National Institute for Health and Care Excellence. Those bodies were established either by the National Health Service Act 2006 or by the Health and Social Care Act 2012. The new bodies are not undertaking any activities that are likely to be chargeable; the exemptions, therefore, provide certainty that, despite being bodies corporate, they will not come within the charge to corporation tax for any period.

To answer one of the questions raised by the hon. Lady, I can confirm that there is no cost as a consequence of this measure; as the tax information impact note makes clear, there is a nil impact on the Exchequer. As for her question on whether the NHS Commissioning Board is essentially NHS England, yes, that is correct, but we do not believe that that causes any particular difficulties with the wording of the clause; for legal purposes, there should be clarity there.

I hope that that provides sufficient clarification to the Committee and that the clause may stand part of the Bill.