Fuel Duty
Debate between Simon Hoare and Dan Tomlinson(2 weeks, 1 day ago)
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Simon Hoare
My right hon. Friend is right. It is important to relitigate this point: we froze fuel duty not merely because we could but because there was a reason so to do. It is why—I say this as a former Local Government Minister—we enhanced and protected and preserved the rural services delivery grant to reflect precisely the additional costs for local government of providing services in rural areas. Again, that was not just slashed but scrapped by the Government in the local government settlement.
There are also the costs of the school run, and I am going to have to declare an interest as a parent of three daughters still at school. When my wife takes our three girls to school, it is a 22-mile round trip from home to school and back, and then again in the afternoon. Forty-four miles for no other reason than to transport three children to school to get an education and to fire up their ambition and aspiration. Hundreds of parents across the constituency do exactly the same, and they will be impacted negatively as a result of this increase.
I think as well about those who are trying to get to hospital appointments. I live relatively close to the West Dorset border, but if a constituent living close to me has to go to Dorchester hospital, they perform something like a 40-mile round trip just to get to a hospital appointment. This is not just a tax increase in isolation; it comes on top of the other inflationary pressures that the Government have authored as a result of national insurance and business regulation and so on making things much harder for businesses, which means that all the costs of those in the business sphere will, by definition, be passed on to customers. I really hope that people do not decide to miss that hospital appointment, not because they no longer need it but because they feel that they cannot afford to travel to and from it.
The Minister does not need me to tell him of the acute pressure that our hospitality sector is facing across the whole UK, and rural areas in particular. Pubs face great pressures, and many in the North Dorset constituency are closing, regrettably. If people cut back on their travel because petrol or diesel has become too expensive and they have reduced their travels to merely just what they would deem to be the absolute essentials, then leisure and relaxation purposes will be eradicated from their menu of choice. That, again, will have a negative pressure on a sector already hit.
I always like to try and wind you up, Madam Deputy Speaker, by saying something like, “To bring my opening remarks to a conclusion”. You will be delighted to know, however, that I am bringing my overall remarks to a conclusion. Sometimes Governments move slowly because the process requires them to. Sometimes, as we have seen in other circumstances, where they have a will, Governments can move incredibly quickly. If the PPS could leave her Minister alone for just a moment, I would appreciate it if he listened to this.
Simon Hoare
This is a point I made to the Parliamentary Secretary to the Treasury. All these increases—in council tax, domestic and transport fuel, food prices and so on—are putting pressure on so many household budgets. The Minister knows that; he will see the data from his officials in real time. Families need to make plans—can they afford that holiday during the school summer holidays or to travel to visit a relative later in the year? I am sure that to the Treasury and to the broad, big-picture statistician, these small matters, individual cases, vignettes and cameos of people’s lives are slightly a nuisance, but these are real lives lived on a daily basis by our constituents.
It would be indefensible, illogical and an act of self-harm for the Government to proceed as the Chancellor suggested that she would and increase main fuel duties from 1 September. Some tactical guy may well be looking at a whiteboard in No. 10, desperately trying to fill in the late summer grid when the House is not sitting, saying, “I know, in the third week of August, we will mention that we are not going to do it.” I can understand that in public relations or media management terms, but I say to the Minister, who is a common-sense man—I hope that he will get the common sense of this—that this has all the signs and hallmarks of an inevitable change of heart from the Government. It is not a question of whether but when. He will be sustained—I am sure there will be other calls on him to spend it—by a massive increase in VAT from heating oil from domestic uses over the next several weeks. If we can agree that it is a question of not whether but when, from the bottom of my heart, on behalf of my hard-working constituents of North Dorset, my farmers and those micro and small businesses, I urge the Minister to recognise the common sense, the necessity and that the landscape has changed in just those few short weeks since the Budget was delivered, to make that change and to announce it soon.
Clause 1
Debate between Simon Hoare and Dan Tomlinson(2 months, 3 weeks ago)
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Dan Tomlinson
I am sure that Environment Ministers will continue to engage with farming unions and farming representatives. Both in the run-up to the Budget and subsequently, Treasury Ministers and those from other Departments have engaged with farmers, and we will continue to do so, to support farmers in a way that the previous Government never did.
Individuals will still benefit from 100% relief for the first £2.5 million of combined business and agricultural assets, and the figure will be fixed at that level until April 2031, alongside other inheritance tax thresholds, as we have been debating. Any unused allowance can be transferred to a surviving spouse or civil partner, including where the first death is before 6 April 2026. On top of that amount, there will be a 50% relief, which means that inheritance tax will be paid at a reduced effective rate of up to 20%. We are also reducing the maximum rate of business property relief available from 100% to 50% for shares designated as not listed on the markets of registered stock exchanges. The reliefs sit alongside other exemptions and nil rate bands. This means that a couple will now be able to pass on up to £5 million of agricultural or business assets tax-free between them. That is on top of existing allowances, such as the nil rate band.
Where inheritance tax is due, those liable for a charge can pay any liability on the relevant assets over 10 annual instalments, interest-free. This benefit is not seen elsewhere in the inheritance tax system, and it means that the relief continues to be more generous than it was for the vast majority of the 20th century. In fact, from April 2026, the reliefs will be more generous than they ever were under, for example, Margaret Thatcher’s Government.
Our reforms are expected to result in a total of up to 1,100 estates across the UK paying more inheritance tax in 2026-27. Only up to 185 estates across the UK claiming APR, including those also claiming BPR, are expected to pay more in the next tax year. This means that around 85% of such estates will not pay any more tax as a result of the changes in 2026-27. Excluding estates holding shares designated as not listed on the market of registered stock exchanges, only up to 220 estates across the UK only claiming business property relief are expected to pay more.
Dan Tomlinson
Go on, then. I will give way, but I was trying to make progress so that other Members could speak.
Simon Hoare
I hate to interrupt the Minister, but the Chancellor in effect told the House and the country when this policy was first introduced that people need not really worry a huge amount, because not a vast number of farms would fall into this trap. The welcome but limited announcement made just before Christmas will of course reduce still further the number of people who will fall into this trap. He has just set out to the Committee a very complicated set of checklists, including this, that and the other. Would it not make more sense to scrap this whole damned stupid idea, and give a big tick of confidence to our food-security-bringing, environment-protecting, job-creating farming sector, which is so vital to UK plc?
Dan Tomlinson
The Government do support the farming sector and the farming industry. We will continue to do so through the funds that we will make available via DEFRA—funds that were not fully spent under the previous Government. We have listened to farming communities and business representatives, and raised the threshold from £1 million to £2.5 million as a result of that listening and engagement. The Government do not think it would be right to abolish the policy in full, because then we would forgo £300 million of revenue from the very largest estates. [Interruption.] The hon. Member for North Dorset (Simon Hoare) may say that £300 million is a rounding error, but it is important to raise revenue from a broad range of taxes, and from those with the largest-value estates in the country. As I said earlier, hundreds of millions of pounds in tax is relieved from the very largest estates in the country. If Opposition Members want that to continue to be the case, that is of course their right, but we Government Members think that our reforms are fair, and raise proportionate revenue from the very largest estates.
Oral Answers to Questions
Debate between Simon Hoare and Dan Tomlinson(3 months, 3 weeks ago)
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Dan Tomlinson
I thank my hon. Friend for her question and her continued campaigning on this issue, which I know is important to her constituents. On those who seek to bend the rules, companies like Airbnb now send data to His Majesty’s Revenue and Customs on all their hosts, and where hosts fail to provide the detail that HMRC requires, Airbnb stops payments until they do. However, we need to go further, and I will meet my hon. Friend to discuss this.
Simon Hoare (North Dorset) (Con)
In the hope that the Government had listened to the National Farmers’ Union and others, a North Dorset farming family sat to watch the Chancellor’s Budget statement, in expectation. They were disappointed with the announcement on the family farm tax. The farmer withdrew from his medical treatment, and three days later he died. That is how determined he was to keep the farm in his family. He knew the struggle that they would have had in meeting the tax bill after 1 April. I share that not to be inflammatory, but to ensure that Members on the Treasury Bench know that their decision on the family farm tax has direct consequences for people up and down the country.
Dan Tomlinson
Members on the Treasury Bench are fully aware of the fact that changes to inheritance tax have an effect on those who are older. In the changes to both agricultural and business property relief that we have put forward, we have ensured that there is a higher allowance, with an extra £1 million, and a tax rate that is half as low as everyone else pays. We think that these reforms, which raise money in a fair and sustainable way, will contribute to raising the revenue that we need, in a way that protects family farms. Of course, we understand that there will be impacts on people. That is why we have designed the policy in the way that we have, and why we came forward with the changes that we announced at the Budget just a few weeks ago.