WELFARE

We set out today the details of that welfare cap – and we will seek the support of Parliament for it next week.

From housing benefit to tax credits, the full list of benefits included in the cap is published in the Budget document today.

Only the State Pension and the cyclical unemployment benefits are excluded.

I am setting it at £119 billion in 2015-16. It will rise, but only in line with forecast inflation, to £127 billion in 2018-19.

Britain should always be proud of having a welfare system that helps those most in need.

But never again should we allow its costs to spiral out of control and its incentives to become so distorted that it pays not to work.

In future, any government that wants to spend more on benefits will: have to be honest with the public about the costs, need the approval of Parliament, and will be held to account by this permanent cap on welfare.

TAX AVOIDANCE

Mr Deputy Speaker,

The distributional analysis published today shows that the Budget decisions, and the decisions across this parliament, mean the rich are making the biggest contribution to the reduction of the deficit – because we are all in this together.

The independent statistics show that under this government income inequality is at its lowest level for 28 years.

Thanks to my RHF the Prime Minister’s leadership we have driven the international efforts to develop tough, new global tax rules that stop rich individuals hiding their tax and companies shifting their profits offshore.

Here at home we’re collecting twice as much as before through compliance – collecting the taxes that are due.

And the number of registered tax avoidance schemes has fallen by half.

And while the vast majority of wealthy people pay their taxes, there is still a small minority who do not.

We will now require those who have signed up to disclosed tax avoidance schemes to pay their taxes, like everyone else, up front.

This will apply in future to schemes covered by our General Anti-Abuse Rule too.

If people feel they’ve been wronged, they can of course go to court. If they win, they get their money back with interest.

We have already consulted on this idea – now we will implement it. The OBR confirm that this will bring forward £4 billion of tax receipts. And it will fundamentally reduce the incentive to engage in tax avoidance in the future.

The public tolerance for those who do not pay their fair share evaporated long ago – but we’ve had to wait for this government before there was proper action.

So today we go further still:

I am increasing HMRC’s budget to tackle non-compliance.

We will block transfers of profits between companies within groups to avoid tax.

We will increase tax credit debt recovery rates for those with sufficient earnings.

We will give HMRC modern powers to collect debts from bank accounts of people who can afford to pay but have repeatedly refused to, like most other Western countries.

We will increase compliance checks to catch migrants who claim benefits they aren’t entitled to, saving the taxpayer almost £100 million.

We will take action to curb potential misuse of the EIS and VCT schemes.

And we are expanding the new tax we introduced to stop people avoiding stamp duty by owning homes through a company.

We will expand the tax on residential properties worth over £2 million to those worth more than £500,000.

And from midnight tonight anyone purchasing residential property worth over half a million pounds through a corporate envelope will be required to pay 15% stamp duty.

None of this applies to homes that are rented out.

Many of these are empty properties held in corporate envelopes to avoid stamp duty.

This abuse will end.

Mr Deputy Speaker,

Another abuse has been the manipulation of the LIBOR rate.

Our regulators are broadening their investigation to the foreign exchange markets – and I will keep the House informed.

Financial services are a hugely important industry to this country which I want to promote around the world.

But I also want the fines paid by those who have demonstrated the worst of values to support those who demonstrate the best of British values.

I’m talking about the men and women in our armed forces who risk their lives to keep us free.

So I will continue to direct the use of the LIBOR fines to our military charities and our emergency service charities too.

Because the sums continue to grow, I can today extend that support to our search and rescue and lifeboat services – and provide £10 million of support to our scouts, guides, cadets and St John’s Ambulance.

I am also today waiving inheritance tax for those in our emergency services who give their lives protecting us.

I will also relieve the VAT on fuel for our Air Ambulances and Inshore Rescue boat services across Britain, and provide a new air ambulance for London – all in response to huge and heartfelt public demand and the campaigning of my Hon. Friends for Hexham, Brentford & Isleworth, and Argyll & Bute.

Tomorrow is the 21st anniversary of the IRA bomb that killed young Tim Parry and Johnathan Ball.

Survivors for Peace was set up by Tim’s parents, Colin and Wendy, and it no longer receives lottery funding. My HF for Warrington South and the RHM for Dulwich have both raised this issue, and I know myself what incredible work they do.

To honour the memory of all victims of terrorism we will provide the funding the programme needs.

Last month with my RHF for Dumfriesshire I visited Lockerbie to pay my respects on the twenty fifth anniversary of the tragedy. And we will support the scholarships created for local people there to study in the United States.

Further, this summer, many services of remembrance will be held in our cathedrals to mark the Great War, so we are providing £20 million to support the repairs needed to these historic buildings.

We will also support the celebration of the 800th anniversary of the signing of the Magna Carta next year.

King John’s humbling centuries ago seems unimaginably distant.

A weak leader,

Who had risen to the top – after betraying his brother,

Compelled by a gang of unruly barons to sign on the dotted line.

So I will provide a grant to the Magna Carta Trust to ensure that today’s generation learn the lessons of the past.