2. Will the Cabinet Secretary provide an update on how the Welsh Government is using its taxation powers to support high street businesses? OAQ(5)0115(FLG)

Dirprwy Lywydd, as part of the £210 million provided in Wales to help businesses with their tax bills, £10 million has been provided in a dedicated scheme to assist those on the high street. The calling of a general election will not delay the provision of that help in Wales.

Thank you, Cabinet Secretary. Since being elected last year, I’ve regularly been in contact with small businesses and communities across my constituency, and small business representatives, such as the Mold business forum, to take on board their concerns and to bring that to people’s attention to take action where needed. Most recently, I’ve been working closely with representatives in Holywell, whose town centre has been left reeling by bank closures on the back of one another. But, despite this, I think there’s an energy and enthusiasm there to turn the town’s fortunes around, with exciting initiatives such as a teenage market to encourage young entrepreneurs. And just down the road in Flint, I’ve recently met with business owners along with my MP counterpart. A lot of these have been hit by business tax revaluation. I know that’s being addressed, and they’ve repealed that, but they’re also feeling the pinch of the temporary drop in footfall as a consequence of the regeneration work that is taking place and is well under way in the town centre. It’s brought to my attention that we need to think outside the box about how we can create healthy high streets for the future. So, Cabinet Secretary, can I ask if you’ll give consideration to how the Welsh Government’s taxation and other new powers could be used to more innovative ends, in order to better sustain our high streets and encourage and allow them to prosper in the future?

Well, Dirprwy Lywydd, one of the ways in which I hope we will use our new fiscal responsibilities is to be able to look at the interaction between different forms of taxation in Wales. So, we have non-domestic rates, which fall on local businesses, but we have other forms of taxation, and the Finance Committee looked very carefully during its consideration of land transaction tax, for example, on the way that land transaction tax falls on the commercial sector as well. Historically, these different streams of taxation have rather been treated by Governments as though they had little interaction with one another. We will have a narrower suite of fiscal responsibilities in Wales, but one of the opportunities that that affords us is to be able to look more closely at the way that they interact with one another, and particularly to see how they then impact upon businesses and upon the high street.

Yes, of course, Cabinet Secretary, we acknowledge the targeted high-street relief scheme, although some of those high-street businesses are still surprised that they are ineligible for it. And those that may be eligible are still finding some difficulty in as much as the Welsh Government’s link to that information on the website is still not working. For those who are perhaps a bit disappointed by the slightly narrow range of support offered, would you be prepared to consider the Welsh Conservative manifesto commitment to reduce income tax in Wales, not just to enhance the income tax cuts introduced by the Conservative Prime Minister in Westminster, which has benefited so many Welsh workers of course, but also to offer material help to those who are high-street employers, very often in partnerships or as sole traders and, of course, who cannot take advantage of the other low Conservative corporation tax rate?

Well, the party that’s in Government in Wales has a manifesto commitment not to raise income tax rates during the lifetime of this Assembly. Voters will be listening very carefully to what the Conservative Party has or has not been willing to say in relation to taxation and I think will be much more worried about the prospects of tax rises under a Conservative Government than they will be by the prospect that has just been outlined by the Member.

There are some specific risks to Wales as a result of our withdrawal from the European Union, but there are also some opportunities, not least the ability, for instance, to set regional or sub-national rates for VAT, for example on hotel accommodation, to boost our tourism sector, or for house renovation to boost our construction sector. Will the Cabinet Secretary be making an application to have those powers devolved to Wales so that we can have tax levers that will be able to boost our economy?

Adam Price is quite right when he refers, I think indirectly, to the fact that the Silk commission ruled out devolution of VAT on the grounds that it wasn’t a workable variable tax within the European Union. Once we are no longer members of the European Union, then VAT, I think, does come back onto the table for debate as a possible devolved tax for Wales because we would be potentially able to use it differentially. Although I’m certainly not at the point that he alluded to in his supplementary question, I do agree with him that this is now a topic that ought properly to be considered both by Government and by others who have an interest in this area.