A Finance Act is the headline fiscal (budgetary) legislation enacted by the UK Parliament, containing multiple provisions as to taxes, duties, exemptions and reliefs at least once per year, and in particular setting out the principal tax rates for each fiscal year.

Overview

In the UK, the Chancellor of the Exchequer delivers a Budget speech on

Budget Day Budget Day is the day that a government presents its budget to a legislature for approval, in a ceremonial fashion. It only exists in some countries of the world. India The Union Budget of India, referred to as the Annual Financial Statement in ...

, outlining changes in spending, as well as tax and duty. The changes to tax and duty are passed as law, and each year form the respective Finance Act. Additional Finance Acts are also common and are the result of a change in governing party due to a

general election A general election is a political voting election where generally all or most members of a given political body are chosen. These are usually held for a nation, state, or territory's primary legislative body, and are different from by-elections ( ...

, a pressing loophole or defect in the law of taxation, or a backtrack with regard to government spending or taxation. However, a repeal order can also be made by

statutory instrument In many countries, a statutory instrument is a form of delegated legislation. United Kingdom Statutory instruments are the principal form of delegated or secondary legislation in the United Kingdom. National government Statutory instrumen ...

. The rules governing the various taxation methods are contained within the relevant taxation acts. Capital Gains Tax legislation, for example, is contained within

Taxation of Chargeable Gains Act 1992 The Taxation of Chargeable Gains Act 1992c 12 is an Act of Parliament which governs the levying of capital gains tax in the United Kingdom. This is a tax on the increase in the value of an asset between the date of purchase and the date of sale of ...

. The Finance Act details amendments to be made to each one of these Acts. The main taxes are

Excise Duties file:Lincoln Beer Stamp 1871.JPG, upright=1.2, 1871 U.S. Revenue stamp for 1/6 barrel of beer. Brewers would receive the stamp sheets, cut them into individual stamps, cancel them, and paste them over the Bunghole, bung of the beer barrel so when ...

, Value Added Tax, Income Tax,

Corporation Tax A corporate tax, also called corporation tax or company tax, is a direct tax imposed on the income or capital of corporations or analogous legal entities. Many countries impose such taxes at the national level, and a similar tax may be imposed a ...

, and

Capital Gains Tax A capital gains tax (CGT) is the tax on profits realized on the sale of a non-inventory asset. The most common capital gains are realized from the sale of stocks, bonds, precious metals, real estate, and property. Not all countries impose a c ...

Excise

Excise duties file:Lincoln Beer Stamp 1871.JPG, upright=1.2, 1871 U.S. Revenue stamp for 1/6 barrel of beer. Brewers would receive the stamp sheets, cut them into individual stamps, cancel them, and paste them over the Bunghole, bung of the beer barrel so when ...

are inland duties levied on articles at the time of their manufacture. *Alcoholic liquor duties **

Alcoholic Liquor Duties Act 1979 Alcoholism is, broadly, any drinking of alcohol that results in significant mental or physical health problems. Because there is disagreement on the definition of the word ''alcoholism'', it is not a recognized diagnostic entity. Predomina ...

* Hydrocarbon Oil Duty **

Hydrocarbon Oil Duties Act 1979 In organic chemistry, a hydrocarbon is an organic compound consisting entirely of hydrogen and carbon. Hydrocarbons are examples of group 14 hydrides. Hydrocarbons are generally colourless and hydrophobic, and their odors are usually weak or e ...

*Tobacco products duty **

Tobacco Products Duty Act 1979 Tobacco is the common name of several plants in the genus ''Nicotiana'' of the family Solanaceae, and the general term for any product prepared from the cured leaves of these plants. More than 70 species of tobacco are known, but the chie ...

*Gaming duty ** Finance Act 1997 (rates of gaming duty) *Amusement Machine Licence Duty **

Betting and Gaming Duties Act 1981 Gambling (also known as betting or gaming) is the wagering of something of value ("the stakes") on a random event with the intent of winning something else of value, where instances of strategy are discounted. Gambling thus requires three elem ...

Vehicle Excise Duty Vehicle Excise Duty (VED; also known as "vehicle tax", "car tax", and more controversially as "road tax", and formerly as a "tax disc") is an annual tax that is levied as an excise duty and which must be paid for most types of powered vehicles which ...

Vehicle Excise and Registration Act 1994 A vehicle (from la, vehiculum) is a machine that transports people or cargo. Vehicles include wagons, bicycles, motor vehicles (motorcycles, cars, trucks, buses, mobility scooters for disabled people), railed vehicles (trains, trams), wate ...

Specific finance acts

Finance Act 1910

The Finance (1909–10) Act 1910 resulted in a significant net increase in taxation, and it also requisitioned a survey dubbed by right-wing journalists the " Lloyd George's Domesday land-survey", in particular entailing the 1910–1915

valuation map Valuation may refer to: Economics *Valuation (finance), the determination of the economic value of an asset or liability **Real estate appraisal, sometimes called ''property valuation'' (especially in British English), the appraisal of land or bui ...

s. Each property and related right under and over land (hereditament) in England and Wales was surveyed and valued, so

Increment Value Duty Increment value duty was a UK tax based on The Finance (1909-1910) Act (10 Edw. VII, c.8) - the People's Budget - in response to the unequal ownership of land in the early 20th century. The tax was based on the increase in value of property due to ...

based on

land value Real estate appraisal, property valuation or land valuation is the process of developing an opinion of value for real property (usually market value). Real estate transactions often require appraisals because they occur infrequently and every prop ...

could be levied when any property was sold. The initial rate was 20% of the increase in land-value between the date of the survey and the date of sale (capital gain). Exemptions included farmland and plots smaller than . This tax was substantively altered by the repeal of s. 67 by the Finance Act 1920 which superseded it. As part of the survey, landowners had to fill in a form, and the resulting records are extremely useful for

local history Local history is the study of history in a geographically local context, often concentrating on a relatively small local community. It incorporates cultural and social aspects of history. Local history is not merely national history writ small b ...

. The records today consist of: * working maps * valuation maps * valuation books * field books. The valuation maps and books are kept in local record offices, and the other items are in the National Archives at

Kew Kew () is a district in the London Borough of Richmond upon Thames. Its population at the 2011 census was 11,436. Kew is the location of the Royal Botanic Gardens ("Kew Gardens"), now a World Heritage Site, which includes Kew Palace. Kew is a ...

, London (field books in series IR58; working maps in series IR121 to IR135 according to region and each region has up to 22 different districts).

Finance Act 1920

This included a new "Duty on licences for mechanically propelled vehicles" (

, which went into the Road Fund until 1936), repealed "customs duties on motor spirit and motor spirit dealers licence duties", and introduced "Provisions as to spirits used for generating mechanical power" along with other provisions related to income tax and tax on alcohol.

Finance Act 1946

The 1946 Act established the

National Land Fund The National Land Fund of the United Kingdom was a sum of money held by HM Treasury for the purpose of securing culturally significant property for the nation as a memorial to the dead of World War II. It was created in 1946. Proposed by Chanc ...

and much of

National Savings and Investments National Savings and Investments (NS&I), formerly called the Post Office Savings Bank and National Savings, is a state-owned savings bank in the United Kingdom. It is both a non-ministerial government department and an executive agency of HM Tr ...

Finance Act 1948

The 1948 Act established the "Special Contribution", which was a one-off wealth tax.

Finance Act 1965

The 1965 Act introduced

corporation tax A corporate tax, also called corporation tax or company tax, is a direct tax imposed on the income or capital of corporations or analogous legal entities. Many countries impose such taxes at the national level, and a similar tax may be imposed a ...

and

capital gains tax A capital gains tax (CGT) is the tax on profits realized on the sale of a non-inventory asset. The most common capital gains are realized from the sale of stocks, bonds, precious metals, real estate, and property. Not all countries impose a c ...

Finance Act 1972

The 1972 Act introduced value added tax.

Finance Act 1977

The Finance Act 1977 abolished the last remaining

tithe A tithe (; from Old English: ''teogoþa'' "tenth") is a one-tenth part of something, paid as a contribution to a religious organization or compulsory tax to government. Today, tithes are normally voluntary and paid in cash or cheques or more r ...

s payable to the Church of England or

Church in Wales The Church in Wales ( cy, Yr Eglwys yng Nghymru) is an Anglican church in Wales, composed of six dioceses. The Archbishop of Wales does not have a fixed archiepiscopal see, but serves concurrently as one of the six diocesan bishops. The posi ...

Finance Act 2000

The Finance Act 2000 increased the

Climate Change Levy The Climate Change Levy (CCL) is a tax on energy delivered to non-domestic users in the United Kingdom. Scope and purpose Introduced on 1 April 2001 under the Finance Act 2000, it was forecast to cut annual emissions by 2.5 million tonnes b ...

Finance Act 2010

This Act shortly before the

2010 United Kingdom general election The 2010 United Kingdom general election was held on Thursday 6 May 2010, with 45,597,461 registered voters entitled to vote to elect members to the House of Commons. The election took place in 650 constituencies across the United Kingdom unde ...

, passed as set out by the Labour Party adjusted the rates of the main taxes, in particular introducing on income tax the 50% 'additional rate' band. The Act also reversed a prospective rise enacted in the Finance Act 2007 of the inheritance tax nil rate band threshold from £325,000 to £350,000 which would have applied from 6 April 2010, thus, emphasising a degree of redistribution, the tax instead continues to apply to death estates that do not benefit from any exemptions (such as spouse nil-rate-bands) and consist of a property valued at 25% above the national average.

Finance (No. 2) Act 2010

This Act of 27 July 2010 under the

Coalition Government A coalition government is a form of government in which political parties cooperate to form a government. The usual reason for such an arrangement is that no single party has achieved an absolute majority after an election, an atypical outcome in ...

reduced the headline rate of

to 18%. The Act increased the general rate of VAT from 17.5% to 20% (while cutting it for imported goods and materials from to 28.58% to 25% ).

Finance (No. 3) Act 2010

Enacted on 16 December 2010 this Act extended foster care relief, extended the applicability of venture capital schemes to companies with a "permanent establishment" in the UK "in financial health", modified the meaning of "distribution" in the Corporation Tax Acts, addressed the income tax treatment of seafarer's income, adjusted treatment of REITs:, modified rules as to EEA/UK consortium claims for group relief, introduced first-year allowances for zero-emission goods vehicles, adjusted for VAT purposes treatment of non-business use of business assets, amended penalties for failure to make payments on time and returns on time, proceduralised recovery of overpaid stamp duty and petroleum revenue tax, modified compliance checks as to excise duties, and clarified the tax treatment of asbestos compensation settlements in relation to the three main taxes.

Finance Act 2020

The Finance Act 2020 (2020 chapter 14) was enacted on 22 July 2020. Part 2 provides for the introduction of a Digital Services Tax.UK Legislation
Finance Act 2020, part 2
accessed 29 September 2020

Full title of the act including preamble and enacting formula

Notes and references

;Notes ;References {{UK legislation Finance in the United Kingdom Law of the United Kingdom