The Government’s change to inheritance tax relief on farming businesses was “the straw that broke the camel’s back”, the president of the National Farmer’s Union will tell members.
A “mass lobby” of MPs organised by the National Farmers’ Union (NFU) will take place in Westminster on Tuesday, alongside a separate protest which thousands are expected to join.
NFU President Tom Bradshaw will tell members at an event in central London ahead of the mass lobby that the changes are an “extraordinary” betrayal of farmers by the Government.
Previously, farming businesses qualified for 100% relief on inheritance tax on agricultural property and business property.
But now the tax is being imposed on farms worth more than £1 million, with an effective tax rate of 20% on assets above the threshold, rather than the normal 40% rate for inheritance tax.
The Government says that the actual threshold before paying inheritance tax could be as much as £3 million, once exemptions for each partner in a couple and for the farm property are taken into account.
However, Mr Bradshaw will say that the “shocking policy” was built on “bad data” and was launched without consultation.
The NFU are warning more farmers will be affected by changes to tax relief on their property and land than the Treasury has accounted for.
Let us remember that they promised not to do this when they were wooing the rural vote. It’s not only been bungled in delivery, it’s also nothing short of a stab in the back
Official estimates suggest only the richest quarter of landowners will be affected, but the NFU and others say reforms to inheritance tax relief could drag more farmers into paying extra.
“To launch a policy this destructive without speaking to anyone involved in farming beggars belief,” Mr Bradshaw will say.
“And let us remember that they promised not to do this when they were wooing the rural vote.
“It’s not only been bungled in delivery, it’s also nothing short of a stab in the back.”
He will call the budget “a kick in the teeth” following years of changing policy and 18 months of “some of the worst weather on record”.
“Far from catching wealthy homeowners with a bit of land, the Treasury’s mangling of the data means those people will generally not be affected,” he will say.
“It’s the farms producing this country’s food, which are more valuable assets, that are caught in the eye of the storm.
“The irony that this asset wealth will never become actual wealth unless farms are broken up or sold – kicking the legs out from under Britain’s food security – is a bitter one.
“And they will need to be broken up or sold, because farmers simply won’t have the money to pay this tax any other way.”
He will call on members to tell MPs their stories, and to tell them how it will affect their farms, families, and futures.
“It may be that ministers think today will be ‘it’, that we’ll get tired and they can just wait this out,” he will say.
“Well farmers may get tired, but as every one of you in this room knows, they don’t give up. We won’t give up.
“We won’t stop fighting this nationally or locally, in every constituency. If they don’t realise that, they really don’t know farmers at all.”
