Senedd Committees have expressed concerns over government modifications to the Welsh Tax Acts etc. (Power to Modify) Bill. Primary concerns include constitutional issues and retrospective aspects of the proposals.

The Welsh Tax Acts etc. (Power to Modify) Bill was introduced to the Senedd on 13 December 2021. It proposed to allow the Welsh Ministers to amend primary tax legislation through regulations.

The Senedd Finance Committee and the Legislation, Justice and Constitution Committee had similar worries.

  • That the government wants to limit the ability of ordinary backbench Members of the Senedd (MSs) to influence, shape and ultimately amend Welsh tax regulations. 
  • That the powers for the Welsh Ministers to make retrospective changes to tax legislation before an announcement was made. It was argued such powers would undermine the principle that law should be certain in its effect.
  • Future devolved Welsh taxes would also be made under the regulatory principle, including Welsh taxes without a UK equivalent tax.

The Bill proposes to give the Welsh Ministers new regulation-making powers to amend the three Welsh Tax Acts:

The Bill’s Explanatory Memorandum says the powers would be used to give Welsh Ministers new regulation-making powers to amend the three Welsh Tax Acts. They would be used under the following criteria:

  • To ensure the devolved Welsh taxes comply with international obligations.
  • To protect against tax avoidance.
  • To respond to changes made by the UK Government to ‘predecessor’ UK taxes (ones where Wales has an equivalent devolved tax) which affect, or may affect the amount paid into the Welsh Consolidated Fund.
  • To respond to decisions of the courts/tribunals which could affect how the Welsh Tax Acts work.

The Finance Committee recognised that the Welsh Ministers need the ability to respond to external events to protect the overall resources available to the Welsh Government and COVID-19 was a good example.


The current form of the Bill would give ministers the power to amend Welsh Tax Acts using regulations. This would save the government from having to get primary legislation passed in the Senedd. Instead, the new rules would be introduced as secondary legislation only allowing the Senedd to accept or reject the new law. In some cases, even secondary legislation submission may not be required.

Using ministerial 'regulations' would also mean they would be introduced immediately making them de facto, retrospective.

Both the Chartered Institute of Taxation (CIOT) and the Institute of Chartered Accountants in England and Wales (ICAEW) stated in their response to the Welsh Government’s consultation on the Bill that their default position is that tax legislation should be in primary legislation, particularly in the case where legislation relates to the exercise of tax powers, except in very exceptional circumstances.

Useful guides on this topic

Welsh Land Transaction Tax
What is Land Transaction Tax? How does it operate? What reliefs are available?  

This section covers taxes devolved to Wales.

Consultation: Welsh Tax Acts etc. (Power to Modify) Bill
The Welsh Senedd has published 'Consultation: Welsh Tax Acts etc. (Power to Modify) Bill' which seeks views on the proposed Bill, the principles behind having the power to modify Welsh Tax Acts and protect Welsh tax revenues, as well as the effectiveness of the proposed mechanisms.

External links

Report on the Welsh Tax Acts etc. (Power to Modify) Bill. Welsh Parliament, Legislation, Justice and Constitution Committee

Welsh Tax Acts etc. (Power to Modify) Bill. Welsh Parliament, Finance Committee


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