Marketing Newscast

(Edited 23 January 2025)

Tesco, Aldi, Lidl, Sainsbury’s, Marks and Spencer and the Cooperative supermarkets have joined Asda and Morrisons in calling on Chancellor Rachel Reeves to halt her Inheritance Tax (IHT) raid on farmers, saying it is putting Britain’s food security at risk. In her October Budget, Reeves announced that any farm worth over £1m – which the National Farmers Union says is the majority of farms - will be subject to 20% IHT from April 2026, having been exempt previously. Tesco’s Chief Commercial Officer Ashwin Prasad wrote in a blog: “This is not just a debate about individual policies – the UK’s future food security is at stake... After years of policy change, it has been harder than ever for [farmers] to plan ahead or to invest in their farms. It’s why we’ll be supporting the National Farmers’ Union’s (NFU) calls for a pause in the implementation of the policy, while a full consultation is carried out.” Sainsbury’s, meanwhile, urged ministers to “listen to the concerns of farmers about the tax changes”. Lidl said it was “concerned that the recent changes to the Inheritance Tax (IHT) regime will impact farmer and grower confidence and hold back the investment needed to build a resilient, productive and sustainable British food system;” while its main rival Aldi said: “We all need a farming sector that can confidently invest in its future and continue to produce high-quality British food.” It has been revealed by The Guardian that the Co-op sent a letter to members of its Co-op Dairy Group saying it had “directly contacted relevant government departments to communicate our hope that they will look again at the impact of the IHT/APR (Agricultural Property Relief) changes”. NFU President Tom Bradshaw welcomed their intervention, saying the tax changes will have “a terrible human impact on elderly farmers”. “It will be older farmers who will be hardest hit by the Government’s misguided family farm tax. One minute they were advised to keep their farms until death to pass them on to the next generation, the next they’re left knowing that if they live beyond April 2026 when the measures come in, their children may have to break up or sell the farm. What an appalling position to put elderly people in.”

Four of Britain’s largest wealth management firms have joined forced to condemn Rachel Reeves’ plans to levy IHT on undrawn pension pots. In a joint letter, Hargreaves Lansdown, AJ Bell, Interactive Investor and Quilter - which collectively manage some £430bn for savers - described her proposals as “flawed and potentially damaging” to grieving families, and demanded she drop them. Previously, unused pension pots could be passed on to beneficiaries IHT free, but they are set to be included within the value of an estate for IHT purposes from April 2027. The letter warned that beneficiaries of those who die aged over 75 could also face “draconian double taxation via IHT and income tax”, with higher-rate taxpayers facing a marginal tax rate on inherited pensions of at least 64%. “It is unconscionable to tax remaining pension funds at levels that could remove their value almost entirely,” it said. The firms suggested an alternative policy of either using the income tax system to tax beneficiaries on death, or reverting to a flat “tax on death” framework with a threshold that would exclude small pots. Dan Olley, CEO of Hargreaves Lansdown said: “People need stability in the tax system to invest for the long term. When looking to change these rules, the system shouldn’t make the experience of bereaved families worse.”

HMRC has, meanwhile, revealed this morning that IHT to the tune of £6.3bn was collected over the nine months to the end of December, an 11% increase on the £5.7bn received in the same period in 2023. Receipts totalled £620m in December alone, an increase of 13% on the £547m collected in December 2023. The Government estimates that 10% of all estates will become liable for IHT by 2030.

“Consumer confidence in the economy is in freefall amid growing fears of recession,” The Telegraph warns this morning, citing two influential surveys. According to the British Retail Consortium, half of consumers expect the economic situation to worsen, while only one-in-six predict an improvement. Older Britons are particularly downbeat, while Generation Z, those aged 27 or under, are the most optimistic. Meanwhile, 62% of those surveyed by consumer group Which? expect the economy to get worse. The surveys have contributed to a subdued London stock market opening this morning: the FTSE 100 is down 3.56 points, -0.04% at the time of writing.

Maros Sefcovic, the European Union's new trade chief has told the BBC that the idea of the UK joining the Pan-Euro-Mediterranean Convention (PEM) “is something we could consider" as part of "reset" discussions between the UK and EU. The PEM utilises common rules that allow parts, ingredients and materials for manufacturing supply chains to be sourced from across dozens of countries in Europe and North Africa to be used in tariff-free trade. Speaking at the World Economic Forum in Davos, Sefcovic said the idea has not been "precisely formulated" by London yet and the "ball is in the UK's court". The BBC understands that the Government has begun consultations with business over the benefits of the PEM plan that could help cut red tape and improve trade, but that no final decision has yet been made. He also said he was surprised at how a European Commission proposal to allow 18 to 30 year-olds from the EU to travel, work and study in the UK for a period, "with reciprocity for young UK nationals", had been "spun" in the UK. "It is not freedom of movement," he said.

Rachel Reeves is also in Davos for the annual World Economic Forum meeting, and has argued the UK will not be a target for President Donald Trump’s trade tariffs because we have a trade deficit with the US. Trump has threatened to double tax rates for foreign nationals and companies in the US where their native countries levy “discriminatory” duties on American firms, but Reeves said he was only concerned about “the trade surpluses that countries around the world are running with the United States” which is “not the case for the UK”. “And so we will work with the Trump administration to get a good deal for Britain and make the case as well for the continuation of that strong trade and investment relationship between our two great countries,” she told journalists, adding: “I believe in free and open trade, and I’ll be making that case to my counterparts in the United States… I’m excited about the opportunity to work with the new Trump administration. Trade between the UK and the US is worth £300bn a year. A million Brits work for American firms. A million Americans work for British firms. So our economies are closely intertwined, and I look forward to enhancing and strengthening that relationship”.

Charlie Nunn, CEO of Lloyds Banking Group, has told Bloomberg TV (also at Davos) that Britain needs “to see action” from Chancellor Rachel Reeves on her plans for economic growth, and that they need to be “accelerated”. “The Chancellor has talked about having set the foundations and having got the foundations right. That was really important,” he said. “We didn’t have an economic plans for the UK that was stable and in a good place. But what we will see over the next few months is the things they have talked about need to now be accelerated and they need to come at pace.” Nunn also said Britain had an “opportunity to get growth going” if US President Donald Trump puts tariffs on the rest of the world: “If tariffs do hit the rest of the world, I think the rest of the world will slow down but the UK with the structure of its economy - more services based, very international, no supply chains heavily into the US - there’s an opportunity for the UK to really stand out… You’ve seen the IMF come out and say they think UK growth will be stronger than the other G7 economies apart from the US, and that’s a great foundation for thinking about the future.” Reeves will set out her growth plan in a speech next week.

Sir Keir Starmer says he is “putting an end” to “challenge culture by taking on the ‘Nimbys’” and reforming the planning system so it is pro-growth and pro-infrastructure.” Under his plans, those fighting planning applications for national infrastructure projects such as train lines, wind farms and nuclear power plants will be allowed to plead their case in court twice at most, down from the current three. The paper permission stage will be scrapped, and the law changed so that if a High Court judge deems a case totally without merit, it will no longer be possible to take it to the Court of Appeal. A Downing Street spokesman cited data showing 56% of major infrastructure projects end up in the courts, often leading to two-year delays, such as in the case of Sizewell C, the nuclear power plant which was delayed for two years as activists took the project through the courts. The case was dismissed eventually, with Judges describing aspects of the challenge “utterly hopeless”. The plans also include stopping newts and bats from blocking construction, changing the current obligation for each project to be assessed individually and mitigation put in place to one involving a new "nature restoration fund" which requires developers to pay into a central fund which will ensure the environment is protected. "The new common-sense approach doesn't allow newts or bats to be more important than the homes hard-working people need, or the roads and hospital this country needs," the government said.

HMRC has denied running a "deliberately poor" phone service in an attempt to push taxpayers to seek help online instead. Nearly 44,000 customers were cut off without warning after being on hold for more than an hour last year, a report by the Public Accounts Committee (PAC) of MPs has found. HMRC CEO Jim Harra said the committee's claims on its customer service were "completely baseless" and added "we've made huge improvements to our service standards, with call wait times down by 17 minutes since April last year".

Liberal Democrat leader Ed Davey has joined former Conservative leader Iain Duncan Smith in calling on Culture Secretary Lisa Nandy to set a deadline for the sale of The Telegraph. He made his comments as it was revealed that that a senior executive at current owners RedBird IMI urged bosses at the newspaper to make one in 10 staff redundant and abandon planned editorial investment.

Wetherspoons founder and Chairman Sir Tim Martin is considering opening his pubs overseas in hotspots frequented by British tourists and “have an existing pub culture”. “I think an existing pub culture is probably the difference between coffee shops – which can go anywhere in the world – and pubs,” he told The Sun newspaper. Although the current focus of the brand is on franchise deals in the UK, Martin added: “Theoretically there could be some franchises in those British holiday areas.” “We are looking at it,” he said. “We think there are probably 100 to 200 franchise partnerships in the UK. Now it’s a question of going abroad and it’s a possibility. There is now an opportunity for franchises abroad, but not in China.” However, he remarked that any decision was some six months away as Wetherspoons is focussed currently on new UK-based pubs.