Clause 56 - SEIS: re-investment relief

Part of Finance Bill – in a Public Bill Committee am 10:30 am ar 11 Mehefin 2013.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Photo of Brooks Newmark Brooks Newmark Ceidwadwyr, Braintree 10:30, 11 Mehefin 2013

Again I would like to reiterate my support for seed EIS and the particular aspect of reinvestment relief. The idea behind reinvestment relief is to turbo-charge the incentives that people have to step up to the plate with this particular opportunity. The idea was that in the first year of seed EIS, angel investors would get not only 50% of their income tax but this idea of roll-over relief. If they made a capital gains, they could then reinvest that in year one and get an extra 28% on the relief for making an investment, thereby  taking up the relief to 78% on a particular investment. As the Minister is well aware, over the last six months of last year, particularly over the summer, I travelled to 14 different cities promoting that concept. One of the points made to me was that during its introduction the message did not get off the ground and into the market as fast as it could have done.

Several entrepreneurs have asked why the reinvestment relief was not given for a longer period. I congratulate the Government on listening to what business people have said and extending that roll-over relief on reinvestment, but will the Minister tell us why he is only allowing 50% of it rather than 100% this year, given that such important schemes take time to get out into the market? I encourage the Government to let another full year go by where 100% rather than 50% of the qualifying funds reinvested get the relief. Perhaps the Minister could address that point as well.