The federal government has doubled down on insisting solely 1 / 4 of farms might be affected by inheritance tax plans as hundreds of farmers get able to protest on Tuesday.
After Chancellor Rachel Reeves introduced 20% inheritance tax will apply to farms value greater than £1m from April 2026, the place they have been beforehand exempt, the coverage has change into the federal government’s largest thorn in its aspect.
1000’s of farmers, together with celeb farmer Jeremy Clarkson, are resulting from descend on Whitehall on Tuesday to protest the change.
And 1,800 extra will participate in a “mass lobby” the place members of the Nationwide Farmers’ Union (NFU) will meet their MPs in parliament to induce them to ask Ms Reeves to rethink the coverage.
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Forward of the protest, Sir Keir Starmer mentioned on Sunday, on the best way to Brazil for the G20, that he’s “absolutely confident the vast majority of farms and farmers will not be affected by this”.
His spokesman reiterated the prime minister’s, and different ministers’, feedback on Monday as he mentioned the federal government expects 73% of farms to not be affected by the change.
“We remain confident that the vast majority of farms won’t be affected by this,” he mentioned.
Setting, Farming and Rural Affairs Secretary Steve Reed mentioned solely about 500 out of the UK’s 209,000 farms could be affected, in accordance with Treasury calculations.
Nevertheless, that quantity has been questioned by a number of farming teams and the Conservatives.
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The NFU mentioned the true quantity is about two-thirds, with its president Tom Bradshaw calling the federal government’s figures “misleading” and accusing it of not understanding the sector.
The Nation Land and Enterprise Affiliation (CLA) mentioned the coverage might have an effect on 70,000 farms.
Conservative shadow farming minister Robbie Moore accused the federal government final week of “regurgitating” figures that symbolize “past claimants of agricultural property relief, not combined with business property relief” as a result of he mentioned the Treasury doesn’t have that knowledge.
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Welsh farmers carried out a protest outdoors the Welsh Labour convention in Llandudno, North Wales, over the weekend
Agricultural property aid (APR) presently gives farmers 100% aid from paying inheritance tax on agricultural land or pasture used for rearing livestock or fish, and may embrace woodland and buildings, resembling farmhouses, if they’re obligatory for that land to perform.
Farmers may declare enterprise property aid (BPR), offering 50% or 100% aid on property utilized by a buying and selling enterprise, which for farmers might embrace land, buildings, plant or equipment utilized by the enterprise, farm outlets and vacation cottages.
APR and BPR can typically apply to the identical asset, particularly farmed land, however APR must be the precedence, nonetheless BPR may be claimed as well as if APR doesn’t cowl the complete worth (e.g. if the land has growth worth above its agricultural worth).
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APR and BPR can apply to farmland, which the Conservatives say has been missed by the Treasury in compiling its influence figures. File pic: iStock
Mr Moore mentioned the Division for the Setting, Farming and Rural Affairs (DEFRA) and the Treasury have disagreed on what number of farms might be impacted “by as much as 40%” because of the lack of knowledge on farmers utilizing BPR.
Nevertheless, farming minister Daniel Zeichner mentioned: “The figures are absolutely clear, fewer than 500 [farms] will be affected.”
Lib Dem MP Tim Farron mentioned final week1,400 farmers in Cumbria, the place he’s an MP, might be affected and won’t be able to afford to pay the tax as many are on lower than the minimal wage regardless of being asset wealthy.
