Key facts
- Entrepreneurs should not be deterred from building multi-generational businesses by inheritance tax, according to Emma Reynolds, chief secretary to the Treasury.
- Reynolds made the comments during a visit to Numatic International, a manufacturer of vacuum cleaners.
- The government has increased the value of business assets that can be passed on tax-free to £2.5 million.
- Value above £2.5 million is taxed at an effective rate of 20 percent.
- Numatic International employs 1,100 people and has an annual turnover of £260 million.
Emma Reynolds, the chief secretary to the Treasury, has encouraged entrepreneurs not to be deterred by inheritance tax when building multi-generational businesses. Speaking during a visit to Numatic International, the maker of the Henry vacuum cleaner, Reynolds highlighted the government's efforts to support wealth creators.
Reynolds stated that the economic fundamentals of Britain are strong and that the country has the highest growth in the G7, while also cutting the deficit more quickly than other G7 nations. She acknowledged concerns about inheritance tax but pointed to the government's increase in the value of business assets that can be passed on tax-free to £2.5 million. Assets above this threshold are taxed at an effective rate of 20 percent. According to government policy, any unused allowance can be passed to a surviving spouse, and tax owed can be paid interest-free over 10 years.
Numatic International, founded in 1969 by Chris Duncan, employs 1,100 people and reported an annual turnover of £260 million and pre-tax profits of £28 million in 2024. Reynolds described the company as "very impressive."
Reynolds also addressed criticism that the Treasury acts as a "growth inhibitor," stating that the department has two major responsibilities and works closely with No. 10 North. She declined to provide reassurance on potential increases to capital gains tax, noting that the budget would be held earlier than usual to reduce speculation. The chancellor, John Healey, is expected to use the budget to provide "breathing space" for businesses and families.
Simon Lawson, Numatic's managing director, emphasized the importance of buying British, a focus Reynolds stated the Treasury is prioritizing.