Select Committee · Treasury Committee

The venture capital market

Status: Closed Opened: 28 Apr 2022 Closed: 16 Jan 2024 8 recommendations 10 conclusions 1 report

The Committee is holding a short inquiry into the venture capital market. Read the call for evidence to find out more about the inquiry

Reports

1 report

Title	HC No.	Published	Items	Response
Nineteenth Report - Venture Capital	HC 134	24 Jul 2023	18	Responded

Recommendations & Conclusions

4 items

7 Recommendation Nineteenth Report - Venture Capital Rejected

Require disclosure of diversity statistics for EIS, SEIS, VCT tax relief eligibility.

HM Treasury should make provision of diversity statistics a requirement for eligibility to receive EIS, SEIS and VCT tax reliefs. Firms should be required to disclose the gender and ethnic breakdown of both recipients of their funding and their own staff. This should take effect from the renewal of the …

Government response. The government rejects making the provision of diversity statistics a requirement for eligibility to receive EIS, SEIS, and VCT tax reliefs, citing legal complexity and administrative burdens for small, young businesses. It notes HMRC is reviewing ways to obtain additional …

HM Treasury

9 Recommendation Nineteenth Report - Venture Capital Rejected

Require ‘comply or explain’ for Women in Finance Charter and Investing in Women Code eligibility.

All relevant organisations in the venture capital industry ought to become signatories to both the Women in Finance Charter and Investing in Women Code, if they have not done so already. We have not determined that compulsory membership is appropriate at this time but recommend that HM Treasury and the …

Government response. The government rejects making compliance with the Women in Finance Charter and Investing in Women Code a 'comply or explain' condition for EIS, SEIS, and VCT eligibility. It argues this approach would not achieve desired results and would place an …

HM Treasury

14 Recommendation Nineteenth Report - Venture Capital Rejected

Consult on revised 7 and 10-year company age limits for EIS and VCT schemes.

The Government should extend the 7 and 10 year company age limits for support through the EIS and VCT schemes. HM Treasury should consult on revised limits, with the objective of not disadvantaging regional businesses. This revised limit should take effect from the renewal of the sunset clauses in April …

Government response. The government rejects extending the 7 and 10-year company age limits for EIS and VCT schemes, arguing it would risk displacing investment from smaller companies and is not an appropriate way to address regional imbalances, despite agreeing that regional businesses …

HM Treasury

16 Recommendation Nineteenth Report - Venture Capital Rejected

Consult on higher funding limits for EIS and VCT schemes to support scale-up businesses.

HM Treasury should consult on higher funding limits on the EIS and VCT schemes with the objective of better supporting scale-up businesses. These revised limits should take effect from the renewal of the sunset clauses in April 2025.

Government response. The government acknowledges the importance of supporting scale-up businesses and highlights existing support through the British Business Bank and British Patient Capital. However, it rejects consulting on higher funding limits for EIS and VCT schemes, arguing that such revisions would …

HM Treasury

Correspondence

6 letters

Date	Direction	Title
20 Oct 2023	To cttee	Letter from the Chair to HM Treasury, relating to the 'Venture Capital' report …
10 Mar 2023	—	Correspondence from the Chair to the Chancellor, relating to the sunset clause …
10 Mar 2023	—	Correspondence from the Chancellor, relating to the sunset clause on EIC/VCT, d…
10 Mar 2023	—	Written evidence from the Association of Investment Companies
7 Sep 2022	To cttee	Letter from the Permanent Secretary, HM Treasury, relating to Venture Capital, …
7 Sep 2022	To cttee	Letter from the Chair to the Permanent Secretary, HM Treasury, relating to Vent…