Farming industry awaits as speculation mounts around changes to Agricultural Property Relief, Inheritance Tax and fuel duty.
In his reaction to the Labour Party's Autumn Budget reveal, former Prime Minister Rishi Sunak said 'to the family wanting to pass on their farm or their business to their children, your taxes are going up'.
He said Labour had broken its manifesto promises and will leave the country's 'children and grandchildren' with millions of pounds of debt.
Mr Sunak went on to say Labour's tax hikes with stall business growth and failed fulfil promises of 'balancing the books'.
On the topic of inheritance tax, Ms Reeves started off by saying only 6% of estates will pay inheritance tax this year.
She said she understands the strong desire to pass down savings to children and grandchildren. She is taking a 'balanced approach.'
She said she wants to protect 'small family farms' with 'three quarters' of farm unaffected by these changes.
Ms Reeves confirmed she would extend the inheritance tax threshold freeze for a further two years to 2030.
"The first £325,000 of any estate can be inherited tax free, rising to £500,000 if the estate includes a residence passed to direct descendants, and £1,000,000 when a tax free allowance is passed to a surviving spouse or civil partner."
She added this would ensure the Government continues to protect small famly farms.
Agricultural Property Relief will still apply to the first £1m of combined business and agriculture assets attracting no inheritance tax. But assets above £1m, inheritance tax will apply with a 50% relief from April 2026.
Ms Reeves confirmed the Government would set a 2% productivity, efficiency and savings target for all departments to meet next year.
The Chancellor said she has had to make 'difficult decisions' to tax.
Whilst the cost of living remains high, and uncertainty of global conflict, Ms Reeves said increasing fuel duty tax would be the wrong thing to do. She confirmed fuel duty tax will be frozen for next year and the 5p reduction in fuel duty will be retained for another year.
She confirmed an increase in employer's national insurance contributions to 15% in April 2025 and reduce the threshold to £5,000.
She warned if the opposition party did not agree with this choice they were choosing 'austerity'
The Chancellor confirmed the national minimum wage will increase by 6.7% to £12.21 an hour for over 21 year olds. For 18-20 year olds, the minimum wage will rise from £8.60 to £10 in April 2025.
Ms Reeves said her Government will invest in HMR systems, 'clamp down' on umbrella companies which 'exploit workers' and go after' the 'promoters of tax avoidance scheme'. She said measures to reduce the tax gap will raise 6.5 billion pounds by the end of the forecast.
The Chancellor said today's Budget will end 'short-termism' and focus on 'growing the economy'. She said we will be 'transforming our planning rules' to 'get Britain building again.'
The Chancellor said she would continue the Bank of England's inflation target of 2%, which is forecast to be reached in 5 years time.
She also said the Government would share a line by line breakdown of what the '£22 billion pound blackhole' includes.
The chair has to intervene to remind MPs that people are listening at home and want to hear what the Chancellor is saying. Ms Reeves stands back up again and continues with her speech.
She said this is a 'changed Labour party' and we will 'restore stability' once again.
This budget will raise taxes by 40 billion pounds. "Any Chancellor standing hear today would have to face this reality, and any responsible Chancellor would take action."
She said it falls on this Labour party to 'rebuild' Britain once again. She said this is the first Budget in our country's history to be delivered by a woman, adding she was 'deeply proud' to be Britain's first female Chancellor.
She said British people have inherited the former Government's failure and 'hid the reality' of their spending plans.
"Let me make this promise to British people, never again will we allow a Government to hide the true state of our public finances".
She said public finances are not the only thing 'broken', public services are too, adding the previous Government had no plan to put public finances on a 'better footing'.
Chancellor of Exchequer Rachel Reeves starts delivering her Budget statement at the dispatch box. She said 'change must be felt' and 'more pounds in peoples pockets'. The only way to drive economic growth is to 'invest, invest, invest', adding we must turn the page on the last 14 years.
South Norfolk MP Ben Goldsborough asked the Prime Minister what the Government's plan was to back British Farming and give farmers long term security, adding when the PM talks about working families, he thinks about his working farming families in his own constituency in Norfolk.
The PM said nobody did more damage that his nearby predecessor [Liz Truss] to rural communities. He said his Government would turn around 'Tory neglect' for British farmers in the upcoming Budget.
Commons chamber is full for PMQs, ahead of the Chancellor's Budget, with many MPs forced to stand at the back of the room. Many waiting to hear questions put to the Chancellor by opposition parties in relation to Labour's imminent Budget.
Prime Minister Questions has started ahead of the Chancellor's budget. As their last exchange with one another across the dispatch box, the Prime Minister thanks the outgoing Conservative leader, Rishi Sunak for his service.
Outgoing Conservative Party leader said he is looking forward to spending more time in Richmond, Yorkshire.
Sir Keir Starmer jokes that given the 'speed' that the Conservative Party goes through leaders he would not be surprised if he made a return.
Chancellor of the Exchequer Rachel Reeves is preparing the Labour Party's first financial statement for 14 years.
Speculation has been rife as to the areas Ms Reeves will focus on as she seeks to 'plug the £22 billion' funding gap the Labour Party said they have inherited from the Conservative Government.
Source - https://www.farmersguardian.com
