Labour’s tax changes will see 22,000 jobs go across the Werst Midlands, new research reveals today.
The Government billed its autumn budget as pro-business, but the reality, according to the study published today, will be anything but.
‘11th-hour U-turn required’
Steve Rigby, a business leader based in the region, called on the Government to “reconsider” these changes, which by 2030 are forecast to cut UK economic activity by £15bn.
Family Business UK (FBUK), supported by 32 trade associations and conducted by CBI Economics, the independent consultancy arm of the CBI, examined the impacts on the West Midlands economy of amendments by Chancellor Rachel Reeves to Business Property Relief (BPR) and Agricultural Property Relief (APR). It found:
- 21,987 full-time jobs could be lost;
- a reduction of around 9% driven by business owners opting to cut investment by more than 16%.
- Impacts felt by businesses themselves and their supply chains
- BPR changes could see turnover fall by 10.3%
- APR changes could bring falls of 11.7% –
- Economic activity (GVA) across the West Midlands is set to drop by £1.4bn.
‘Govt must urgently reconsider’
Neil Davy, CEO of Family Business UK, said: “This latest research shows just how far-reaching, and immediate, the impact of these policy changes is. No industry, sector, region or parliamentary constituency will be immune.”
He added: “The Government must urgently reconsider these policy changes.”
Steve Rigby, chair of FBUK and co-CEO of Midlands based Rigby Group, said: “Without doubt these tax changes will hit UK businesses hard, particularly in the Midlands.
“We are at the 11th hour, but it is still not too late for the Government to reconsider solutions that would generate tax without threatening the future growth prospects of family businesses.”
Family firms account for 90% of the private sector
Family businesses play a crucial role in the economy accounting for nine out of every 10 private sector firms. BPR and APR are critical to family businesses.
The changes announced in the budget mean that from April 2026 family business owners will have to pay 20% inheritance tax on their business and agricultural assets when they die.
According to the study, across the UK by 2030 the changes to BPR and APR could lead to:
- 208,500 jobs loses from family businesses and their supply chains
- £14.86bn less economic activity (GVA)
- a £1.87 billion net fiscal loss to government.
