Provisional collection of taxes

36.36As explained above, the practice following the Budget statement is for a general debate to take place on the first Ways and Means resolution and for the questions to be put on all the resolutions upon which the Finance Bill is to be founded at the end of the last day of the Budget debate. Provision has first to be made, however, for giving immediate provisional validity to those proposals which are to come into force (many of them on Budget day itself) before specific statutory authority can be obtained. This is done under the terms of the Provisional Collection of Taxes Act 1968 (as amended), or under the Finance Act 1973, s 50 (as amended).

The Provisional Collection of Taxes Act 1968, s 5 provides that provisional validity may be given to specified Budget resolutions by means of a single motion. This omnibus motion is made immediately after the conclusion of the Budget speech and the question on it is put forthwith under Standing Order No 51(2).1 The Budget resolutions thus given provisional force must be passed within the next ten days on which the House sits for their validity to be continued.

The Provisional Collection of Taxes Act 1968 does not apply to new taxes. Section 1 provides, in the case of income tax, corporation tax, value added tax, customs and excise duties and certain other duties and levies specified in that section, for the renewal for a further period of any tax in force (with or without modifications) and for the variation or abolition of any existing tax. Section 3 of the Act provides for securing new duties of customs and excise.

Section 1, as amended by the Finance Act 2011, s 88,2 lays down that resolutions passed which contain a declaration that it is expedient in the public interest that they should have statutory effect under the provisions of the Act, shall be valid for a period of seven months. A resolution ceases to have statutory effect, however, if a bill varying or renewing the taxes to which it relates is not read a second time by the House within the next 30 days on which the House sits after the resolution is agreed to. The resolution also ceases to have statutory effect in the event of a dissolution of Parliament, or on the passage of an Act renewing or varying the tax,3 or on the rejection of the provisions giving effect to the resolution. If the resolution is modified by the House it has effect as so modified. The application of the Act is limited by s 1(8) to one resolution of the same effect during the same session. The Finance Act 1973, s 50, as amended by the Finance Act 1993, s 207, lays down broadly similar provisions in relation to changes in stamp duty.

Since section 1 relates only to pre-existing taxes and duties, it is necessary to make separate provision for the protection of the revenue to be obtained from new duties of customs and excise. Section 3 of the Act provides that, in respect of new duties which have been imposed by means of resolutions as from a prescribed date, provision may be made for securing their collection from that date by the requiring of security in the case of customs duties and by regulations to be made by the Commissioners for Her Majesty's Revenue and Customs in the case of excise duties.


  1. 1. See the Speaker's statement, HC Deb (1967–68) 761, c 251.
  2. 2. The changes made in 2011 were principally concerned to provide for carry-over of Finance Bills between sessions (on which see also SO No 80B and para 30.32 ). Additionally, they made provision for cases where a bill is not re-introduced in a new session and removed references to specific months of the year; on the changing timing of the Budget, see para 33.29.
  3. 3. In 1981, an increase in the excise duty on hydro-carbon oil took immediate effect under the Provisional Collection of Taxes Act. When the ensuing Finance Bill was amended to provide for a lower rate of increase, it was further amended to provide that the full increase should have effect for the period between Budget day and 2 July of that year (see Finance Act 1981, s 4).