Commentary on Sections Overview Section 1029: Power to undo changes
3125.This section confers power on the Treasury to undo changes in the law made by the Act, for the purpose of restoring the effect of the law to what it was immediately before 6 April 2007 (the date on which this Act will come into effect). It is new.
3126.The power will make it possible for any errors made in rewriting the source legislation to be corrected without recourse to a Finance Bill.
3127.The power provided by this section will, in particular, enable errors in making consequential amendments to be corrected.
3128.For example, had ITEPA contained such a power, it would have been possible to use it to reverse its mistaken repeal of section 108 of FA 1995. In the absence of such a power, it was necessary for the error made by ITEPA to be corrected in a Finance Act (see paragraph 6 of Schedule 17 to FA 2004).
3129.Depending on the nature of the error, corrections made to restore the effect of the pre-6 April 2007 law could be taxpayer-favourable or taxpayer-adverse.
3130.Subsection (2) provides that the power may not be used after 5 April 2010. It is sensible to enable errors to be corrected in this way only over a limited period, and it would in any case become progressively more difficult to do so accurately as subsequent Finance Bills are enacted. The date of 5 April 2010 takes account of this while giving a reasonable amount of time for errors to come to light.
3131.Subsection (4) provides that the power may contain provision having retrospective effect. Whether that was appropriate would need to be considered on a case-by-case basis.
3132.As with the power in section 1028, it is intended that this power will not be exercised without the agreement of the Tax Law Rewrite project’s Consultative and Steering Committees.