Rachel Reeves’ inheritance tax changes will put 125,000 jobs at risk, chancellor warned
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The Builders Merchants Federation has signed the Family Business UK open letter from 32 trade bodies representing 160,000 firms. Rachel Reeves is being warned that her so-called “tractor tax” will not just hit farms but also puts tens of thousands of family businesses at risk along with 125,000 job losses.
The main trade body representing builders - the Builders Merchants Federation (BMF) - has become the latest of 32 trade bodies to sign an open letter to the chancellor warning about the consequences of changes to inheritance tax in the Budget. It has raised serious questions over the Labour government’s hopes over a building revolution pushing forward economic growth.
The 32 trade bodies, representing 160,000 family businesses, have made their intervention ahead of a major protest event at the London Palladium on Monday which will be addressed by Tory leader Kemi Badenoch. The letter warns: “The changes to these policies will have a severe and long-lasting impact on these businesses and the livelihoods of the millions of people they employ. These businesses and the economy will be starved of much-needed investment leading to forced, premature business sales and the loss of jobs in constituencies across the country.”.
They pointed to the published data by CBI Economics which suggests the changes will reduce economic activity by £9.4 billion with a net loss to the Exchequer of £1.25 billion as well as 125,000 job losses. They added: “Business property relief (BPR) and agricultural property relief (APR) are not loopholes. They exist for a purpose. Introduced by Labour in 1976, they allow profitable businesses to continue trading, without penalty, when the owner dies. Where a business is able to do so, a dividend covering the cost of the IHT bill can be paid. But this comes with an additional tax cost of 39.5 per cent - effectively double taxing family-owned businesses.”.
