(1) In paragraph 1 of Schedule 13 to the Finance Act 1996—
(2) Paragraph 2 of that Schedule shall be omitted.
(3) In paragraph 6(3) of that Schedule, for "paragraphs 1(1) and 2(1) above do not apply" there shall be substituted "paragraph 1(1) above does not apply".
(4) Paragraphs 6(4) to (6), 7, 9A and 11 of that Schedule shall be omitted.
(5) In paragraph 14 of that Schedule—
(6) After that paragraph there shall be inserted—
"Strips of government securities: losses
14A (1) A person who sustains a loss in any year of assessment from the discount on a strip shall be entitled to relief from income tax on an amount of his income for that year equal to the amount of the loss.
(2) The relief is due only if the person makes a claim before the end of twelve months from the 31st January following that year.
(3) For the purposes of this paragraph a person sustains a loss from the discount on a strip where—
The loss shall be taken to be equal to the amount of the excess, and to be sustained in the year of assessment in which the transfer or redemption takes place.
(4) In sub-paragraph (3) above the reference to a transfer in paragraph (a) includes a reference to a deemed transfer under paragraph 14(4) above (and paragraph (b) shall be read accordingly).
(5) This paragraph does not apply in the case of—
(7) In the definition of "strip" in paragraph 15(1) of that Schedule, for "is a strip of a gilt-edged security" there shall be substituted "is a strip of a security, or would be if that section had effect with the substitution in subsection (1B) of "issued by or on behalf of the government of any territory" for "issued under the National Loans Act 1968"".
(8) In section 710(3) of the Taxes Act 1988, after paragraph (e) there shall be inserted—
"(f) any relevant discounted security within the meaning of Schedule 13 to the Finance Act 1996 (see paragraphs 3 and 14(1) of that Schedule).".
(9) Subject to paragraph (10) below—
(10) The amendments mentioned in paragraph (9)(a) and (b) above shall not apply in relation to costs incurred, or losses sustained, on the transfer or redemption of a relevant discounted security if—
(11) No losses may be carried forward under paragraph 6(6) of Schedule 13 to the Finance Act 1996 to any year of assessment after 2002–03.
And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.