A wave of discontent is sweeping through the plant hire industry, akin to the farmer unrest over inheritance tax reforms.
- Thousands of farmers plan to protest in London against inheritance tax changes next week.
- The plant hire industry voices similar dissatisfaction and may join the farmers’ demonstration.
- Key figures in the sector describe recent budget measures as detrimental to plant hire businesses.
- Concerns focus on inheritance tax reforms impacting family-run plant hire firms in Scotland and the UK.
The plant hire industry, much like the agricultural sector, is expressing significant dissatisfaction over recent governmental reforms, particularly concerning inheritance tax changes. Thousands of farmers are expected to rally in opposition to these changes, and there is a possibility that the plant hire sector may align with this movement in demonstrations, given their growing unrest.
The Scottish Plant Owners Association (SPOA) has articulated its concerns in strong terms. The recent budget announcement by Rachel Reeves has been described by critics within the industry as a ‘death knell’ for the plant hire sector. Steve Mulholland, the CEO of Construction Plant Hire, remarked that the budget stands as one of the most business-unfriendly in decades. According to an unpublished letter to the Financial Times, he highlighted issues such as the exclusion from full expensing allowances and the increase in national insurance, which he argues would dissuade hiring and slow wage growth amid a need to boost the construction skills base.
John Sibbald, SPOA President, voiced similar concerns, stating that the economic implications of the recent budget could be counterproductive for their industry. With over 42,000 individuals employed in the Scottish plant hire sector, contributing £7.4bn to the economy, the SPOA calls for its members to urge local MPs to safeguard this industry against adverse tax policies.
A significant concern is the removal of 100% business property relief (BPR) and agricultural property relief (APR). These changes are especially harmful to privately owned plant hire companies, which are often heavily invested in valuable assets and properties, pushing them beyond the £1m relief threshold. The SPOA warns that these businesses might lack the liquid assets to address sudden tax liabilities, potentially forcing asset sales and resulting in workforce reductions.
The potential closure of such businesses, if forced to liquidate assets to meet tax obligations, could lead to redundancies and undermine the stability of local economies that rely on these firms. Companies may also incur significant debt, hindering future growth. Although transferring business ownership ahead of time can sidestep some tax burdens, unforeseen circumstances pose substantial risks that this planning cannot mitigate.
Additionally, changes that reclassify double cab pick-up trucks from goods vehicles add to the grievances of the sector, which considers these vehicles essential. The SPOA urges plant hire businesses to participate in a survey conducted by the CBI to express their concerns comprehensively.
The plant hire industry stands at a crossroads, facing significant challenges due to governmental tax reforms.
