Ealing (Parliament Politics Magazine) – Ealing business leaders warn that without key reforms in the upcoming Budget, family-run firms will suffer under mounting economic pressures.
According to Family Business, new inheritance tax reforms that go into effect in April of next year might result in the loss of around 430 local employment and £49 million in economic activity in the Ealing North seat.
Draft legislation has already been released with the revisions, which will cap Business Property Relief and Agricultural Property Relief.
Business executives caution that the government’s last realistic opportunity to change the policy before it becomes law is in the budget.
The warning is especially important in Ealing North, where Treasury Minister James Murray, an MP, is directly involved in carrying out the strategy.
The construction industry, where family ownership is the rule rather than the exception, is one of those most exposed.
A spokesperson for James Murray responded:
“The Government believes its reforms to agricultural property relief and business property relief from get the balance right between supporting farms and businesses, and fixing the public finances.
The reforms reduce the inheritance tax advantages available to owners of agricultural and business assets, but still mean those assets will be taxed at a much lower effective rate than most other assets.
Despite a tough fiscal context, the Government will maintain very significant levels of relief from inheritance tax beyond what is available to others and compared to the position before 1992.”
How will the alterations to the budget affect local business rates income?
The government has indicated that as from April 2026, there will be a permanent change to business rates for small retailers with rateable value properties of less than £500,000, to reduce their costs, while at the same time increasing the multiplier (tax rate) on rateable value properties of over €500,000, and this will likely affect larger customers and landlords.
The fact that the multiplier for bigger value properties is increased to potentially increase income could impact the anchor tenants of the business and commercial landlords and eventually these costs could lead to lost jobs or business closures in town centres.
Overall the business rates regime is slated for reform to be more a ‘fair and fit for the 21st century’, including more frequent revaluations; more accurate relief targeting; stronger deterrence to avoid; and a digital modernisation agenda.
