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Telegraph
8 minutes ago
- Telegraph
Reeves abandons inheritance tax raid on grieving military families
Rachel Reeves has abandoned plans to impose new inheritance tax changes on the grieving families of military personnel. The Chancellor has dropped a proposal to tax death in service payments, which are tax-free lump sums given to the families of deceased Armed Forces members. Changes unveiled in the October Budget would have made off-duty death in service payments subject to inheritance tax for the first time, if not going to a spouse or civil partner. It would have meant that children or partners of unmarried servicemen and women would have had to pay death duties on the benefit from April 2027. The Treasury has been forced to abandon the proposals after pressure from Armed Forces organisations, which said the move would have a 'corrosive' effect on trust among servicemen. The Government said that following its consultation, it had decided not to go ahead with the reform. 'Another U-turn' by Labour Mark Francois, the shadow Armed Forces minister, told The Telegraph that he welcomed the decision, 'even though it represents another U-turn by this Labour Government'. He added: 'It was always unfair that married partners of service personnel would be exempted from these changes to inheritance tax liabilities, while unmarried partners, in long-term relationships, would not. 'We highlighted this to ministers, on behalf of service families on multiple occasions and I am pleased for their sake, that common sense has now finally prevailed.' It comes after Ms Reeves's department had to water down proposals to scrap the universal winter fuel payment and reforms to the welfare system. The Government said: 'From 6 April 2027 all death in service benefits payable from registered pension schemes will be out of scope of Inheritance Tax, regardless of whether the scheme is discretionary or non-discretionary.' The HMRC document said that the new plans were 'in line with the broader policy objective of removing inconsistencies in the Inheritance Tax treatment of different types of pension benefits'. Labour 'standing up' for service personnel? Death in service payments are usually a lump sum paid to named beneficiaries of a worker who dies while on the company payroll. It is typically the equivalent of four-times the late individual's salary. For members of the Armed Forces, these are paid whether or not the individual was 'on duty' at the time of their death. Those who die 'on duty' were to continue to benefit from a separate tax-free arrangement on their death in service payments from 2027. But a military worker who dies while technically 'off duty', such as by sudden illness or accident, would have been stung by the proposed inheritance tax rules. Maj Gen Neil Marshall, the chief executive of the Forces Pension Society, told The Telegraph in January that military servicemen and women are unable to put the payment into trust, because they are part of the Armed Forces pension scheme. Labour sought to shore up support from the Armed Forces community at last year's general election, declaring the party would be 'standing up' for service personnel and veterans. The party was successful in winning over voters from military backgrounds, most notably winning in Aldershot, the site of a major garrison, for the first time in more than a century.


Glasgow Times
an hour ago
- Glasgow Times
UK working with Jordan to air drop aid into Gaza, PM tells Macron and Merz
The Prime Minister held emergency talks with Emmanuel Macron and Friedrich Merz on Saturday amid mounting global anger at the humanitarian conditions in the enclave. In a readout of the call, Number 10 said the leaders had agreed 'it would be vital to ensure robust plans are in place to turn an urgently-needed ceasefire into lasting peace'. 'The Prime Minister set out how the UK will also be taking forward plans to work with partners such as Jordan to air drop aid and evacuate children requiring medical assistance,' a Downing Street spokesperson said. However, the head of the UN's Palestinian refugee agency warned airdrops were 'a distraction and a smokescreen' that would fail to reverse deepening starvation in Gaza, and could in some cases harm civilians. UNRWA chief Philippe Lazzarini said on Saturday: 'A man-made hunger can only be addressed by political will. Lift the siege, open the gates and guarantee safe movements and dignified access to people in need.' Israel said on Friday it will allow airdrops of aid by foreign countries into Gaza to alleviate starvation in the Palestinian territory, where there is widespread devastation. The readout made no mention of the issue of Palestinian statehood, which the Prime Minister has faced calls to immediately recognise after French President Mr Macron confirmed his country would do so in September. However, Downing Street said the leaders had committed to 'work closely together on a plan' to 'pave the way to a long-term solution and security in the region'. Once the proposals have been 'worked up', they will seek to advance them with other key partners, including in the region, the readout said. Some 221 MPs from Labour, the Conservatives, Liberal Democrats, SNP, Greens, Plaid Cymru, SDLP and independents have signed a letter pressuring the Government to follow suit at a UN meeting next week. Donald Trump suggested Mr Macron's announcement, which saw him commit to formally recognising Palestinian sovereignty at the UN General Assembly in September, 'doesn't matter' as he left the US for a visit to Scotland. Sarah Champion, the senior Labour MP who organised the letter by parliamentarians, said recognition 'would send a powerful symbolic message that we support the rights of the Palestinian people'. Other senior Commons figures who signed the letter include Labour select committee chairs Liam Byrne, Dame Emily Thornberry and Ruth Cadbury. US President Donald Trump said a French announcement on Palestinian statehood 'doesn't matter' (Robert Perry/PA) Lib Dem leader Sir Ed Davey, as well as Tory former minister Kit Malthouse, and Sir Edward Leigh – Parliament's longest-serving MP – also signed it. The majority of those who have signed, 131, are Labour MPs. The Government has so far said its immediate focus is on getting aid into the territory and insisted that recognising sovereignty must be done as part of a peace process. Charities operating in Gaza have said Israel's blockade and ongoing military offensive are pushing people there towards starvation, warning that they are seeing their own workers and Palestinians 'waste away'. The Prime Minister will meet the US president during his trip to Scotland, where he arrived on Friday evening. US-led peace talks in Qatar were cut short on Thursday, with Washington's special envoy Steve Witkoff accusing Hamas of a 'lack of desire to reach a ceasefire'. The deal under discussion is expected to include a 60-day ceasefire in which Hamas would release 10 living hostages and the remains of 18 others in phases in exchange for Palestinians imprisoned by Israel. Aid supplies would be ramped up and the two sides would hold negotiations on a lasting truce.

Leader Live
an hour ago
- Leader Live
UK working with Jordan to air drop aid into Gaza, PM tells Macron and Merz
The Prime Minister held emergency talks with Emmanuel Macron and Friedrich Merz on Saturday amid mounting global anger at the humanitarian conditions in the enclave. In a readout of the call, Number 10 said the leaders had agreed 'it would be vital to ensure robust plans are in place to turn an urgently-needed ceasefire into lasting peace'. 'The Prime Minister set out how the UK will also be taking forward plans to work with partners such as Jordan to air drop aid and evacuate children requiring medical assistance,' a Downing Street spokesperson said. However, the head of the UN's Palestinian refugee agency warned airdrops were 'a distraction and a smokescreen' that would fail to reverse deepening starvation in Gaza, and could in some cases harm civilians. UNRWA chief Philippe Lazzarini said on Saturday: 'A man-made hunger can only be addressed by political will. Lift the siege, open the gates and guarantee safe movements and dignified access to people in need.' Israel said on Friday it will allow airdrops of aid by foreign countries into Gaza to alleviate starvation in the Palestinian territory, where there is widespread devastation. The readout made no mention of the issue of Palestinian statehood, which the Prime Minister has faced calls to immediately recognise after French President Mr Macron confirmed his country would do so in September. However, Downing Street said the leaders had committed to 'work closely together on a plan' to 'pave the way to a long-term solution and security in the region'. Once the proposals have been 'worked up', they will seek to advance them with other key partners, including in the region, the readout said. Some 221 MPs from Labour, the Conservatives, Liberal Democrats, SNP, Greens, Plaid Cymru, SDLP and independents have signed a letter pressuring the Government to follow suit at a UN meeting next week. Donald Trump suggested Mr Macron's announcement, which saw him commit to formally recognising Palestinian sovereignty at the UN General Assembly in September, 'doesn't matter' as he left the US for a visit to Scotland. Sarah Champion, the senior Labour MP who organised the letter by parliamentarians, said recognition 'would send a powerful symbolic message that we support the rights of the Palestinian people'. Other senior Commons figures who signed the letter include Labour select committee chairs Liam Byrne, Dame Emily Thornberry and Ruth Cadbury. Lib Dem leader Sir Ed Davey, as well as Tory former minister Kit Malthouse, and Sir Edward Leigh – Parliament's longest-serving MP – also signed it. The majority of those who have signed, 131, are Labour MPs. The Government has so far said its immediate focus is on getting aid into the territory and insisted that recognising sovereignty must be done as part of a peace process. Charities operating in Gaza have said Israel's blockade and ongoing military offensive are pushing people there towards starvation, warning that they are seeing their own workers and Palestinians 'waste away'. The Prime Minister will meet the US president during his trip to Scotland, where he arrived on Friday evening. US-led peace talks in Qatar were cut short on Thursday, with Washington's special envoy Steve Witkoff accusing Hamas of a 'lack of desire to reach a ceasefire'. The deal under discussion is expected to include a 60-day ceasefire in which Hamas would release 10 living hostages and the remains of 18 others in phases in exchange for Palestinians imprisoned by Israel. Aid supplies would be ramped up and the two sides would hold negotiations on a lasting truce.