Exmouth MP criticises Budget’s tax burden on area given ‘no observable benefit’

Exmouth and Exeter East MP David Reed has criticised the government’s budget for what he claims is lumping tax rises on his constituents without giving the region an obvious boost.

Mr Reed, a Conservative, fears people and businesses in the area would witness a rising tax burden “yet the south west will see no observable benefit in government spending.

“All of the main infrastructure projects…will be outside of the south west of England, which is news that delivers a heavy blow to our region’s growth and prosperity,” he said.

Chancellor Rachel Reeves outlined that employers’ national insurance contributions will rise by 1.2 percentage points to 15 per cent, and the rate at which firms start paying it for each employee will drop to £5,000 compared to £9,100 now.

The chancellor added that to “support small businesses”, the employment allowance would be raised from £5,000 to £10,500, meaning 865,000 employers would pay no national insurance contributions next year.

Devon Chamber of Commerce welcomed such initiatives to shelter smaller businesses but said that the impact of a rise in the minimum wage, along with the employers’ NI hike, would “have an impact on an already struggling hospitality sector”.

The minimum wage will increase 6.7 per cent to £12.21 from April for people over 21.

“The increase to employers’ national insurance contributions, coupled with the increase to the minimum wage, could cripple many of our small and medium-sized businesses,” Mr Reed added.

“As a former tech business owner, I can clearly see how these approaches will hit businesses and limit their ability for growth and to employ more people.”

Elsewhere, Mr Reed said he is “most concerned” about many farmers in his constituency who could be worse off following tax changes on agricultural property.

NFU president Tom Bradshaw said the government’s “shameless breaking” of its promise on Agricultural Property Relief (APR) would “snatch away much of the next generation’s ability to carry on producing British food, plan for the future and shepherd the environment.”

He continued: “Let’s not sugar-coat this, every penny the chancellor saves from this will come directly from the next generation having to break-up their family farm.”

The tax relief shields agricultural properties fully from inheritance tax, but in future on the first £1 million will get 100 per cent relief, and 50 per cent thereafter.

Mr Reed said the budget confirmed that Labour “says one thing, then does another.

“This budget is a litany of broken promises which Labour shamelessly made to the British public during the general election campaign,” he said.

“Over the coming week, I will be standing up in parliament for our home, and working with south west members of parliament to ensure that our home is not forgotten during this overwhelming tax raid.”