Inheritance Tax

Gregory Stafford Excerpts

Wednesday 14th October 2026 Commons Chamber

[Peter Fortune]

Labour Members are proving once again that they are desperate to talk about the past because they have no plan for the future.

Talking about the pubs in my constituency, we have seen a significant decrease in the number of people employed by them. The British Beer & Pub Association estimates that in Bromley and Biggin Hill, we have gone from around 1,150 people employed in pubs in 2023 to around 800 now. That reduction seems to have hit young people the hardest, with the number of 16 to 24-year-olds employed in the industry down by 200—half the figure in 2023.

Nationally, we have seen total gross value added from pubs and breweries fall from £47 billion in 2023 to £30.8 billion, and the Government’s tax take fall from £17 billion to £3.2 billion. Higher taxation and regulation are strangling an industry and leaving the Government with less money in the end.

[Gregory Stafford (Farnham and Bordon) (Con)]

I know that, like me, my hon. Friend is a champion of his local pubs. I put on the record that one of my local pubs, the Crown in Arford, has just won my “best pub” competition.

On my hon. Friend’s point about taxation, we tax cigarettes to stop people smoking. If we tax jobs, we have fewer jobs, and if we tax economic growth, we have less economic growth. Why does he think that Labour does not get this?

--- Later in debate ---

[Gregory Stafford (Farnham and Bordon) (Con)]

While I am following a vast number of extraordinarily excellent speeches from Opposition Members, unfortunately I am going to have to start with some of the really quite stunning comments from Government Members—comments that clearly demonstrate that the Government have absolutely no clue about what creates wealth in this country, what drives growth in our economy, and what real people who are working hard have to face in Britain every single day. There was no greater example of this than the comments of the hon. Member for Macclesfield (Tim Roca), who I notice has just scuttled out of the Chamber. He had the audacity to misquote Churchill and to call the people who are working hard in this country—the people who are grafting hard—the “idle rich”. What a disgraceful thing to say to those people who are building a business! What a disgraceful thing to say to the farmers who are up at the crack of dawn trying to make their businesses work! He should come back to the Chamber and apologise to them, because they deserve an apology.

I prefer another Churchill quote. He said:

“Socialism is the philosophy of failure, the creed of ignorance, and the gospel of envy”,

and we have seen a lot of failure, ignorance and envy from Government Members today. The real people who are going to be hit by these taxes are not the idle rich who the hon. Member for Macclesfield mentioned; they are the grafters who put in—people like my father’s family, who ran a business for over a century in Hazlemere. They worked hard, took risks, saved, and stood on their own two feet. These are the sort of people who this Labour Government have decided they want to tax to the hilt—to tax out of existence.

For decades, business property relief meant that a family firm could pass to the next generation without a bill. This Government ended that. Relief was capped at £1 million in 2024. Only after a backlash did it rise to £2.5 million of combined business and agricultural property relief. As my hon. Friend the Member for Broadland and Fakenham (Jerome Mayhew) said, though, businesses are not a bank account. Cash and capital are two different things. A business’s value is in its premises, its machinery, its stock and its good will, not necessarily in its cash, so the people who inherit it must find money from the very businesses that employ their staff and extend growth.

[Sir Gavin Williamson (Stone, Great Wyrley and Penkridge) (Con)]

Does my hon. Friend fear, like I do, that we will see so many more family firms being sold, and often sold to foreign buyers—people who have no interest in investing for the long term and investing in local communities?

[Gregory Stafford]

My right hon. Friend is absolutely right. In my constituency—and, I am sure, in his constituency and across the country—small family businesses are having to make really tough decisions about what they are going to do. He is right that they will often go to foreign firms, because those firms will not be hit by this level of taxes. Hitting British businesses so that they will be sold to foreign ones is an odd focus for this Labour Government. It is extraordinary, and if the Government do not see that, they really must think again.

Think of an owner in their 60s deciding whether to buy a new machine or take on another apprentice. Now they must first ask, “What will this do to my tax bill that my children will inherit?”—a tax that, as my right hon. Friend the Member for Stone, Great Wyrley and Penkridge (Sir Gavin Williamson) said, makes owners think twice before investing and building growth.

[Dr Johnson]

My husband is a farmer and runs businesses. He feels a huge responsibility not just in building his business, but to the people he employs. Those people will be affected if the business does not grow or does not invest because he is worried about this tax.

[Gregory Stafford]

My hon. Friend is absolutely right, and she neatly brings me on to some comments about family farms. She is right: it is not just the people who are running these businesses or those people who might inherit them who will end up losing out, but the employees of those businesses too. That is why we are not getting the growth that Labour claims it wants.

With family farms such as Luff’s in Headley, the land, tractors, buildings and a lifetime of labour are passed from generation to generation. The National Farmers Union has calculated that a typical cereals farm making roughly £34,000 a year would face 10 annual instalments of £53,000 a year at the original £1 million threshold. Even at the new threshold, payments of £33,000 a year would swallow nearly all the profit. Essentially, in order to pay, a farmer will have to sell the very fields that earn the living.

The Royal Agricultural Benevolent Institution found that more than a third of farmers are probably or possibly depressed. The Farming Community Network, which supports more than 10,000 people, says that its helpline has been taking calls linked to the upcoming Budget for weeks. As my hon. Friend the Member for Keighley and Ilkley (Robbie Moore) said, this tax has led to suicides. That is a disgrace, and the Government should recognise that and do everything they can to repair the damage that they have done emotionally and economically to our farms. It was only when Ministers were challenged by the shadow Environment Secretary, my right hon. Friend the Member for Louth and Horncastle (Victoria Atkins), that they raised that threshold. If it was right to raise the threshold then, because it was the wrong threshold, can the Government not look at it again and remove it?

Moving on briefly to the general inheritance tax points, the nil rate band has been at £325,000 since 2009. Labour has now said that it will freeze it until April 2031. Had that band risen with inflation, it would be at more than half a million pounds today. To dispel the myth that has been put forward by the Government that inheritance tax affects only a small number of people, the OBR expects one in 10 estates to pay by the end of the decade. The Institute for Fiscal Studies puts that figure at one in six. It will not hit just a small number of people.

A married couple can pass on up to £1 million if their home goes to their children. That might sound generous, but once we add a family home in my constituency to a lifetime of savings and, from April 2027, their pension pots, it is not a significant amount of money in the grand scheme of things. That is especially important when that pension relief is what we on all sides of this House were telling people to do. We were telling people to save for their future, and the reward for their saving is the Government taking more of it in tax. Households that never thought of themselves as wealthy are being pulled in. Under Labour, aspirational families are hit on the way in and unfortunately they are hit on the way out. As Members have said, the shopkeeper will sell their business to fund retirement and the farmer will sell the fields to try to keep just a small measure of their farm.

The Minister on the Treasury Bench must take this message back to the Chancellor: rule out these changes and make things better for our local areas. As the Conservative Opposition, we present an alternative. We will abolish tax on the family home, and we will do that by slashing the welfare bill by £7 billion. It is the first step, and the shadow Chancellor and the Leader of the Opposition have outlined their ambition to go further.

It comes down to a fundamental point. On the one side, we have a Government who see a lifetime of savings and a business built over generations as just another tax opportunity. On the other, we have an Opposition who believe that those savings belong to the family who earned them—not the grifters, not the idle rich, but the grafters. They built this country, and unlike Labour, a Conservative Government will let them keep those savings.

[Several hon. Members rose—]