Inheritance Tax

Wendy Morton Excerpts

Wednesday 14th October 2026 Commons Chamber

[Andrew Griffith]

My right hon. and learned Friend is exactly right. The original reason for the exemption in death duties that previous Labour Governments respected was that generational aspect—the fact that a business or farm does not necessarily produce the cash flow necessary to hand over an enormous part of that value when, tragically, death takes place. I know that my right hon. Friend the Member for Louth and Horncastle will pick up on that point later.

I will move on to businesses, which, as Members across the House will know, are far more numerous than the farms who we know are impacted. Inheritance tax affects businesses in every one of our constituencies, on every one of our high streets and in every one of our trading estates. Often they are businesses that have been in the same family for multiple generations. This is causing extreme jeopardy, to the point that people are having to take action right now to protect those family interests.

Edmund Burke, a man much beloved on the Opposition Benches, said that society is a partnership

“between those who are living, those who are dead, and those who are yet to be born.”

There could be no better manifestation of that than Britain’s family businesses, which are rooted in their local community and provide jobs down the generations. Yet this Government are hellbent on breaking them up and forcing them to sell the pieces to pay an inheritance tax bill that they should never have to face. We Conservatives are on the side of family businesses.

[Wendy Morton (Aldridge-Brownhills) (Con)]

A wealth of small businesses across my constituency keeps our local economy growing. Does my hon. Friend agree that at a time when our businesses need support that will enable them to create employment for the next generation, this Government—on whose Benches there is, of course, no business experience—are just squeezing and squeezing our businesses out of business?

[Andrew Griffith]

My right hon. Friend is quite right. I urge every Member of this House to spend time with family businesses in their constituency; there are excellent organisations such as Family Business UK that would be delighted to make the introduction.

My right hon. Friend is also absolutely right about the relative dearth on the Government Benches of business and private sector experience and of an understanding of how the economy works. However, that is capable of remediation, if only Government Ministers and Members were to seek to educate themselves on the benefits to their constituencies and constituents of family businesses.

We Conservatives will not let a spiteful, prejudiced Labour party destroy those family businesses, which is why we will—

--- Later in debate ---

[James Murray]

Without commenting on individual tax affairs, even if hypothetical, if a farm were worth £3 million, the £2.5 million allowance for the 100% relief would cover a substantial portion of that. That is in addition to the existing nil rate bands and can be transferred between spouses. If that hypothetical farm were passed on via a couple to their descendants, £5 million would be covered.

I want to emphasise that our work as a Government with farmers—who feed the nation, sustain rural communities and help to manage the land that shapes our countryside—ranges from immediate support, including the £65 million emergency package that we announced to help them cope with this summer’s drought, to opening new markets for British produce through trade deals and export opportunities.

[Wendy Morton]

The Minister appears to give the impression that he knows about the farming industry, but how often, if ever, does he actually go out on to a family farm and meet the farmers?

[James Murray]

As the right hon. Lady will know, I have been in a position in the Treasury previously in this Government, and I have had a large number of conversations with people affected by, and worried about, this tax policy. The tax policy introduced in April this year has a £2.5 million threshold for the 100% relief, and we are confident that that balances raising revenue for the public finances with giving the right protection to family farms, which we think is so important.