Written questions by Dowden.

What assessment her Department has made of the potential merits of introducing tax breaks for the training budgets of craft organisations in the film and high-end television sector.

The Government recognises the importance of the film and high‑end television sector, including the highly skilled craft workforce that underpins its success. The Government supports film and high‑end television productions through the Audio‑Visual Expenditure Credit (AVEC), which provides a generous tax credit worth 34 per cent of UK production costs, or 39 per cent for animation and children’s television. Independent films (those with a UK lead writer or director and budgets under £23.5 million) are also eligible for an enhanced AVEC rate of 53 per cent on up to £15 million of core expenditure. These reliefs help attract inward investment, sustain employment, and support skills development across the sector. Whilst there is no specific exclusion of training costs, all qualifying production costs have to be incurred on pre-production, principle photography and post-production. Training costs would usually fall outside of this. In addition to tax reliefs, skills and training in the screen sector are supported through targeted funding programmes led by the Department for Culture, Media and Sport (DCMS) and its arm’s‑length bodies. Film and high‑end television are priority sub‑sectors within the Government’s Industrial Strategy, and DCMS has committed to a £75 million Screen Growth Package to support skills, talent development, and long‑term growth across the UK. There are a wide range of factors to consider when introducing new tax reliefs or expanding existing ones, including their effectiveness in meeting policy objectives, how well targeted the support would be, the impact on complexity in the tax system, and the cost to the Exchequer.

Whether her Department has considered (a) reviewing tax relief eligibility for childcare costs for freelancers in irregular employment sectors such as film and television and (b) enabling greater flexibility in the use of Government-funded childcare hours for (i) nannies and (ii) alternative provision outside standard nursery settings.

It is our ambition that families have access to high-quality, affordable and flexible early education and care, improving opportunity for every child and work choices for every parent. This is key to the government’s Plan for Change, which starts with reaching the milestone of a record number of children being ready for school.The government recognises that evidencing income can be more complex for self-employed individuals, particularly for those with variable or seasonal earnings. That is why self-employed parents are only expected to meet the minimum income requirement over the entire tax-year (and not quarterly as is the case for employees) to qualify for Tax-Free Childcare.

What assessment she has made of the potential impact of proposed changes to (a) Business Property Relief and (b) Agricultural Property Relief on the level of resources required at HMRC.

On 21 July 2025 HMRC published a policy paper on the agricultural property relief and business property relief reforms for Inheritance Tax. The summary of impacts includes an estimate of HMRC’s costs to deliver the measure. https://www.gov.uk/government/publications/reforms-to-agricultural-property-relief-and-business-property-relief

What assessment she has made of the potential implications for her Department's policies of the British Hair Consortium's report entitled Securing the future of UK hairdressing and beauty: the economic, fiscal and societal case for VAT reform, published in February 2025.

VAT is a broad-based tax on consumption, and the 20 per cent standard rate applies to most goods and services. VAT is the UK’s second largest tax, forecast to raise £171 billion in 2024/25. Tax breaks reduce the revenue available for vital public services and must represent value for money for the taxpayer. Exceptions to the standard rate have always been limited and balanced against affordability considerations. Changes to the VAT threshold have to be carefully balanced considering the potential benefits to small businesses, the economy as a whole and tax revenues.

What assessment her Department has made of the potential implications for his policies of the British Hair Consortium commissioned CBI Economics report entitled Securing the future of UK hairdressing and beauty: the economic, fiscal and societal case for VAT reform, published on 19 February 2025.

VAT is a broad-based tax on consumption, and the 20 per cent standard rate applies to most goods and services. VAT is the UK’s second largest tax, forecast to raise £171 billion in 2024/25. Tax breaks reduce the revenue available for vital public services and must represent value for money for the taxpayer. Exceptions to the standard rate have always been limited and balanced against affordability considerations. Changes to the VAT threshold have to be carefully balanced considering the potential benefits to small businesses, the economy as a whole and tax revenues.

What steps her Department is taking to tackle disguised employment practices in the hair and beauty sector.

HMRC is committed to ensuring that the tax system operates fairly and efficiently and creates a level playing field for compliant businesses. Most businesses pay what they owe but a minority fail to register with HMRC or only declare a portion of their earnings. This minority deprive our vital public services of funding, affect fair competition between businesses, and place unfair burdens on everyone else.We are committed to tackling false self-employment and will investigate evidence suggesting businesses have misclassified individuals for tax purposes. In these cases, we will take steps to ensure they pay the right Income Tax and National Insurance contributions.HMRC is making it increasingly difficult for businesses to hide their earnings and have an extensive range of powers, including information gathering powers, that help build a picture of risk and identify those who are trying to abuse the system. Our approach to tax compliance includes a range of activities that aim to both detect and tackle current non-compliance and change future behaviours. Their activities include national campaigns and specialist task forces that incorporate intensive bursts of activity in targeted sectors and locations across the UK. This includes providing customer education highlighting the importance of keeping accurate records. However, we will not hesitate to use stronger sanctions against customers who deliberately choose not to comply, including potential criminal prosecutions for the most serious cases involving tax evasion.We recognise that some customers can find it hard to understand their tax obligations, so we are developing and testing new educational material to better explain the rent a chair model to make it easy for them to get things right and intervening early to reduce mistakes. We are planning for this to be ready for publication on GOV.UK in the spring. We are continuing to work on updates to the Taxable Persons manual and these will be published in due course.

What assessment her Department has made of the potential impact of the increase in employer National Insurance contributions on hair and beauty sector.

A Tax Information and Impact Note (TIIN) was published alongside the introduction of the Bill containing the changes to employer NICs. The TIIN sets out the impact of the policy on the exchequer, the economic impacts of the policy, the impacts on individuals, businesses, and civil society organisations as well as an overview of the equality impacts.       The Office for Budget Responsibility also published the Economic and Fiscal Outlook (EFO), which sets out a detailed forecast of the economy and public finances.

If she will make an assessment of the potential impact of pupils moving schools midway through the academic year as a result of the imposition of VAT on independent schools on (a) staff, (b) parents and (c) pupils.

On 29 July, the Government announced that, as of 1 January 2025, all education services and vocational training provided by a private school in the UK for a charge will be subject to VAT at the standard rate of 20 per cent. This will also apply to boarding services provided by private schools. Any fees paid from 29 July 2024 relating to the term starting in January 2025 onwards will be subject to VAT. A start date of January 2025 will have given schools and parents 5 months to prepare for the changes, and it is right that we introduce these changes as soon as possible in order to raise the funding needed to help deliver our education priorities. The Government has carefully considered the impact that these changes will have on pupils and their families across both the state and private sector, as well as the impact they will have on state and private schools. Following scrutiny of the Government’s costing by the independent Office for Budget Responsibility, the Government will confirm its approach to these reforms at the Budget on 30 October, and set out its assessment of the expected impacts of these policy changes in the normal way. The Government recognises that some pupils may subsequently move into the state education sector. However, the number of pupils who may switch schools as a result of these changes represents a very small proportion of overall pupil numbers in the state sector. The Government is confident that the state sector will be able to accommodate any additional pupils and that these policies will not have a significant impact on the state education system as a whole.

Whether she has made a comparative assessment of the potential merits of introducing VAT on private schools (a) during the academic year and (b) at the start of the new academic year.

On 29 July, the Government announced that, as of 1 January 2025, all education services and vocational training provided by a private school in the UK for a charge will be subject to VAT at the standard rate of 20 per cent. This will also apply to boarding services provided by private schools. Any fees paid from 29 July 2024 relating to the term starting in January 2025 onwards will be subject to VAT. A start date of January 2025 will have given schools and parents 5 months to prepare for the changes, and it is right that we introduce these changes as soon as possible in order to raise the funding needed to help deliver our education priorities. The Government has carefully considered the impact that these changes will have on pupils and their families across both the state and private sector, as well as the impact they will have on state and private schools. Following scrutiny of the Government’s costing by the independent Office for Budget Responsibility, the Government will confirm its approach to these reforms at the Budget on 30 October, and set out its assessment of the expected impacts of these policy changes in the normal way. The Government recognises that some pupils may subsequently move into the state education sector. However, the number of pupils who may switch schools as a result of these changes represents a very small proportion of overall pupil numbers in the state sector. The Government is confident that the state sector will be able to accommodate any additional pupils and that these policies will not have a significant impact on the state education system as a whole.