Family firms urge chancellor to rethink tax rises
Chancellor Rachel Reeves has promised to take bold steps to jumpstart the economy, following concerns raised by two prominent family businesses. Wye Valley Brewery in Herefordshire and Underwoods Steel Stockholders and Fabricators in Worcestershire have urged the Chancellor to reconsider certain aspects of her October Budget, specifically the increase in employer National Insurance contributions and changes to inheritance tax relief.
Director Will Underwood of Underwoods Steel Stockholders and Fabricators expressed his concerns about the impact of the NI increase on his firm’s costs. The rise in NI contributions from 13.8% to 15% on worker’s earnings above £175 is expected to add 10% to the company’s costs overnight, leading to cuts in planned investments in new equipment and staff training.
Meanwhile, Wye Valley Brewery’s managing director Vernon Amor highlighted the significant inheritance tax bill the company is facing due to the changes in the Budget. The brewery, which is celebrating its 40th anniversary this year, is looking at a potential inheritance tax bill exceeding £1m. This could delay or cancel the brewery’s expansion plans over the next few years.
The Treasury defended the changes to inheritance tax relief, arguing that it would make the system fairer. However, businesses like Wye Valley Brewery and Underwoods Steel Stockholders and Fabricators are feeling the immediate impact of these changes on their growth and investment plans.
On a different note, Rachel Reeves’ Budget included substantial tax hikes to increase public spending, with a focus on improving NHS services. The additional funding is expected to reduce waiting times for treatments, with a particular emphasis on utilizing private hospitals to handle the backlog of patients.
Despite efforts to increase appointments and reduce waiting lists, there are still challenges ahead. Patients like Rebecca Farkas in Herefordshire are waiting for essential treatments like a hysterectomy, facing chronic pain and uncertainty due to the prolonged waiting times.
As the government works towards meeting its healthcare targets and revitalizing the economy, the voices of business owners and patients affected by these changes serve as a reminder of the real-world impact of fiscal policies. The balancing act between funding public services and supporting businesses is a delicate one, requiring careful consideration and collaboration to ensure a sustainable and thriving economy for all.
