Chamber and committees

I am more than happy to ask officials to engage directly with the committee following this meeting, and we can discuss how we can take forward that work.

I would not want to describe today’s consideration as the end of the matter. As with all aspects of tax legislation, it is a process rather than an event. A number of issues have been raised. It was always a case of finding a balance. I appreciate that there are competing demands and that not everyone can be satisfied without that impacting on others.

The broader points around transparency and how user friendly the presentation of legislation is—again, that touches on the point about an annual finance bill—are very important. We want to have a tax system that is as straightforward to use as possible. We understand the importance of that in relation to economic growth and providing certainty. In that spirit, we are very keen to continue those conversations, whether with public bodies and other authorities or, indeed, with organisations such as ICAS, CIOT and the Law Society.

The SFC has given its forecast and, for most of the measures, it is below the immateriality threshold. It estimated a maximum of £7 million over the period with regard to the extensions of the timelines from 18 to 36 months, but we will see that even out.

As much as I made reference to having received correspondence from colleagues on the operation of ADS, the system overwhelmingly works as intended. It works effectively, and the whole system is proving to be an important source of revenue for the Scottish Government. The measures that we are considering today are quite narrow, and they will perhaps not affect a significant number of people, but they respond to concerns that have been raised. The point about responding to a unique set of circumstances is one that I accept.

As for what is covered by the particular provision before us, I take the point about the situation in which the conclusion of missives and the closing of the transaction happen almost simultaneously, in which case there is not a window. However, when there is a window between the conclusion of missives and the effective transaction date, if someone were to inherit a property—we should remember that LBTT does not bite on the inherited property—come into possession of that property and purchase another property afterwards, that situation would be almost outwith their control, to some extent, so the proposed measure seeks to provide a relief that is fair and reasonable.

I recognise that the situations in which what is proposed might be of benefit might not be frequent, but for those who find themselves in such situations, it will help to provide greater certainty and fairness in the system.

That is a discussion that we have had previously, in the context of looking to recommence the work of the devolved taxes group, which had to go into abeyance during the pandemic. It is something that the Government is open to discussing further.

I appreciate that I am repeating myself, but it is important that there is engagement with Parliament, if we are to move to that particular system and approach. I imagine that this committee would have to lead on that piece of work. I am conscious of that, and I am more than happy to have further discussions on the matter. I know that officials are happy to engage directly with the committee, as well, but there is a broader set of considerations to take into account in terms of feasibility.

Laura, if you have the numbers in front of you, do you want to come in with the details?

I do not have that number. However, the estate—the number of houses and hostels—that is covered by the Scottish Police Authority is a significantly smaller proportion of the overall property market compared to, say, that of local authorities.

As part of our engagement with the Scottish Police Authority, I am more than happy to explore that further and update the committee in due course.

I recognise the complexity involved, and the issues that ultimately led to the call for evidence and the consultation on the draft order speak to that complexity. I received much correspondence from colleagues outlining their concerns about how ADS was operating. That is why we took forward this work, which seeks to address those concerns.

On the draft order specifically, Revenue Scotland will produce clear and comprehensive guidance ahead of 1 April, should Parliament agree to the order before us, which will be shared in advance. My understanding is that Revenue Scotland has already shared its work with relevant stakeholders in tax, accountancy and law, and that it intends to host a series of webinars in advance of 1 April to ensure that sufficient information, guidance and awareness are provided on how the system will operate, should the order be approved by Parliament.

The exemptions as set out in the amended schedule, should the order be agreed to, would be specific to local authorities under the 1987 and 1988 housing acts. Laura Parker might want to comment on the situation for other public bodies.

Good morning to you, convener, and to the committee.

The Land and Buildings Transaction Tax (Miscellaneous Amendments) (Scotland) Order 2024 provides for amendments to schedule 2A of the Land and Buildings Transaction Tax (Scotland) Act 2013 and introduces a new schedule 6A to the same act.

The amendments to schedule 2A relate to arrangements for the additional dwelling supplement. They address key stakeholder concerns about the existing legislation and ensure that the arrangements for the ADS work as intended.

New schedule 6A to the 2013 act provides extended relief from both residential LBTT and the ADS for local authorities purchasing property to meet local housing needs. It broadly aligns the treatment of local authorities with that of registered social landlords and will help to support our wider housing policies.

The Scottish Fiscal Commission considered the financial implications of the amendments in its December 2023 forecast, and the order was developed following a thorough consultation and review process, which included an initial call for evidence and views, followed by a consultation on draft legislation. The result of that process is a package of amendments that address key stakeholder concerns with the current legislation, ensuring that taxpayers are able to claim the reliefs and exemptions to which they are entitled and extending support where needed.

I welcome the contributions from a wide range of stakeholder groups in developing the content of the draft order, and I hope that the committee will support the motion to approve it this morning.