Huge numbers of building materials companies across the UK have been left fearing for their futures, and could be forced to radically scale back their operations, following the government’s overhaul of the inheritance tax system.
Changes announced by Rachel Reeves in the Autumn Budget mean that family businesses with assets over £1m will, for the first time, be subject to inheritance tax.
While Reeves’ inheritance tax changes have already drawn the ire of British farmers, the national trade body representing the UK’s building materials sector has warned that the changes will also impact many of its members.
“We are hearing across the industry that the changes in inheritance taxation could limit the future of the sector, with many private and family businesses across our membership reporting back that the impact of Business Property Relief will damage enterprise,” John Newcomb, the chief of the Builders Merchants Federation (BMF), said.
“The end result could be a scaling back of the operations at SME merchants, suppliers and even builders in light of the changes, and that will have a significant impact on the whole economy,” he added.
The BMF has said it is now raising the matter with senior government ministers, calling for an urgent discussion on how best to address the challenges.
David Berry, managing director of Lancashire-based building materials firm C&W Berry, which operates across Lancashire, said: “Keir Starmer visited our business two days after the General Election was announced. I would like to ask him now how we handle this situation.
“For nearly 50 years, Business Property Relief has encouraged family-owned businesses to make long-term investments, creating financially stable businesses, offering secure employment, contributing to economic growth and generating annual tax revenues.
“These proposed tax changes put that business ethos at huge risk.”
The government was contacted for comment.