Labour plan means businesses still 'staring down the barrel' for 1 reason

Labour's energy cost plan offers "little comfort" to British businesses coping with rising costs due to tax hikes, an expert has said. Steven Mulholland, Chief Executive of the Construction Plant-hire Association, told The Express that firms are "staring down the barrel", despite ministers aiming to cut energy costs. From 2027, a new British Industrial Competitiveness Scheme will reduce electricity costs by up to £40 per megawatt hour for over 7,000 electricity-intensive businesses in manufacturing sectors like automotive, aerospace and chemicals, officials say.

Mr Mulholland said: "While reduced energy costs have long been a key ask from industry, delaying support until 2027 offers little comfort to the thousands of construction SMEs already grappling with a National Insurance hike - and now staring down the barrel of damaging changes to Agricultural Property Relief, Business Property Relief and Inheritance Tax. The proposed changes to Business Property Relief risk wiping out the very businesses Britain relies on for construction and could result in a loss of £15billion in economic activity."

He added: "For many asset-rich but cash-poor family firms, it could mean selling up just to pay the tax bill.

"Construction SMEs make up 90% of the sector and are essential to delivering the homes, roads and rail this country needs.

"If ministers are serious about growth, they need a tax system that backs the businesses doing the building - not one that prices them out of existence."

The Government said this week that firms supporting more than 300,000 skilled jobs will be exempt from paying levies such as the Renewables Obligation, Feed-in Tariffs and the Capacity Market - "helping level the playing field and make them more internationally competitive".

Officials added: "Eligibility and further details on the exemptions will be determined following consultation, which will be launched shortly.

"The Government is also increasing support for the most energy-intensive firms - like steel, chemicals, and glass - by covering more of the electricity network charges they normally have to pay through the British Industry Supercharger.

"These businesses currently get a 60% discount on those charges, but from 2026, that will increase to 90%. This means their electricity bills will go down, helping them stay competitive, protect jobs, and invest in the future.

"This will help around 500 eligible businesses in sectors such as steel, ceramics and glass reduce their costs and protect jobs in industries that are the backbone of our economy and will be delivered at no additional cost to the taxpayer."