Finance (No. 2) Bill Committee: New Clause 12

What happened: On 12 January 2026, the House of Commons, sitting as a Committee of the whole House, voted on whether to add New Clause 12 to the Finance (No. 2) Bill. New Clause 12 was tabled by the official Opposition as an amendment to the government's Finance Bill, and would have altered the tax provisions in the legislation. The motion was defeated by 350 votes to 167.

Why it matters: The Finance (No. 2) Bill legislates for a range of tax changes including increases to dividend income tax rates, increases to savings and property income tax rates, and the continued freezing of income tax thresholds. New Clause 12, along with related amendments tabled by the Conservatives, sought to amend or scrutinise these measures. Its defeat means the government's tax package advances unchanged through committee scrutiny, keeping in place rising dividend tax rates, frozen thresholds, and the new property income tax bands that critics argue increase the burden on savers, pensioners, landlords and small business owners.

The politics: The vote split almost entirely along government-versus-opposition lines. All 341 Labour and Labour-Co-operative Members who voted did so against the amendment, while Conservatives, Liberal Democrats, the Democratic Unionist Party, Plaid Cymru, Reform UK and the Traditional Unionist Voice all voted in favour. Four Green Party MPs voted with the government. The result reflects the government's comfortable Commons majority, and sits within a broader pattern of the opposition challenging Labour's tax-raising Budget measures, seen also in parallel votes on National Insurance Contributions legislation in March 2026.