I was delighted to attend a parliamentary reception celebrating the vital contribution of family businesses to local communities and the UK economy. The event, hosted by Family Business UK - the largest independent organisation representing the country’s five million family firms - brought together family-owned companies from across the UK to share their concerns ahead of the upcoming Budget.
Businesses raised particular worries about the Government’s plans to change Inheritance Tax relief for agricultural and business property. Currently, the relief allows 100% exemption with no upper limit, but at the Autumn 2024 Budget the Government announced that this would be capped at £1 million from April 2026.
Family business leaders told the MP that confidence and investment are already being hit. They referred to a recent Family Business UK-commissioned report warning that the reforms to Inheritance Tax could lead to the loss of 208,000 jobs and a £15 billion hit to the UK economy over the lifetime of this Parliament.
The report found that in the Thirsk and Malton alone, restricting relief for family businesses could see a £22.83 million blow to the economy and the loss of 347 full-time jobs if the changes go ahead. Family business owners described postponing investment, halting recruitment and, in some cases, considering selling up due to the uncertainty created by the proposals.
Family firms are the backbone of our local and national economy. They provide jobs, invest in skills, and contribute so much to our communities in Thirsk and Malton. It is deeply worrying to hear how the Government’s proposed changes to Inheritance Tax and Business Property Relief are undermining confidence and putting future investment at risk.
My own background as a business owner for over 30 years showed me the challenges faced by small and family businesses, such as barriers to growth or access to finance.
With the Budget only weeks away, Ministers need to think again. We simply cannot afford policies that discourage growth or force family businesses to consider selling up. I will continue to press the Government to support these vital employers.
