Over the next five years, more than 200,000 jobs could be in jeopardy due to the government's inheritance tax raid, according to recent research.
Last year, Chancellor Rachel Reeves implemented extensive changes to business and agricultural property relief in the Autumn Budget, affecting family-owned businesses and farms across the º£½ÇÊÓƵ, as reported by .
A study conducted by CBI Economics, commissioned by lobby group Family Business º£½ÇÊÓƵ, discovered that by April 2030, 208,500 full-time jobs could potentially be lost as a result.
The policy alteration is projected to generate approximately £1.8bn in tax revenue over the next five years, but at a net fiscal cost of £1.9bn.
CBI Economics also determined that the tax modifications would lead to a GVA loss of £14.8bn to the economy.
In the Autumn Budget, alterations to BPR and APR restricted 100 per cent relief from inheritance tax to the first £1m of claims, with a 50 per cent tax rate applied above this threshold.
Impact of death tax 'staggering'
Shadow business secretary Andrew Griffith responded to the research, stating that Labour's proposals were based on "hooky treasury maths and a blatant breach of election promises."
"The impact of the Chancellors death tax on farms is already understood – but the impact on family-owned businesses is many times that with a staggering 200,000 jobs at risk."
"This survey shows just how little this government understand or care about business," he added.
In total, nearly half of family businesses anticipated reducing headcount, with an average decline of nine per cent in employment.
Approximately 50% of businesses are considering halting or cancelling their planned investments, leading to an overall investment reduction of 16%.
The agricultural sector is anticipated to experience the most significant investment decline, with an average decrease of 17%, as reported by CBI Economics.
A Treasury spokesperson commented: "Our reforms to Agricultural and Business Property Reliefs will mean three quarters of estates will continue to pay no inheritance tax at all, while the remaining quarter will pay half the inheritance tax that most estates pay, and payments can be spread over 10 years, interest-free."
"This is a fair and balanced approach which helps fix the public services we all rely on."
"Capping the rate of corporation tax, reforming planning, establishing a National Wealth Fund and creating pension megafunds is part of our Plan for Change to get Britain building, unlock investment and support business so we can raise living standards and make all parts of the country better off."
