With the ‘Tractor Tax’ protests filling the news for several days, yesterday delivered an email from Lib Dem HQ informing me that our MPs are demanding that the tax be axed. I was both surprised and disappointed to see our MPs siding with some very wealthy vested interests on this issue. It is clear that investment in farmland is being used by some as a deliberate ploy to dodge inheritance tax, and beyond romanticising the “family farm” and way of life, I’ve yet to hear a convincing moral or economic argument as to why farmers uniquely deserve a better deal on inheritance tax than you or me. And even after Labour’s proposed changes, the IHT regime for farms still remains far better than that available to almost anyone else.
Ed Davey and Tim Farron tell us that farming is vital to the country, that rural communities have been taken for granted, and that Brexit and trade deals that undercut British farmers with food produced to lower standards is a disaster for them. All that is true, but it has absolutely nothing to do with inheritance tax, and even if Labour change their minds tomorrow, the very real challenges that British farmers face will remain. I find it curious (or perhaps not) that tax is the issue that has brought out farmers to protest, whipped up by some multi-millionaires and a right wing press that is ideologically opposed to all inheritance tax in principle.
If we accept that genuine farming families are deserving of special treatment to allow farms to be passed down tax-free within the family, there are ways that Labour’s plans could be amended to ease that, but Lib Dem MPs are siding with tax-dodging multi-millionaires to reverse the change entirely. They are wrong to do so.
Agricultural Relief has not always existed, having been introduced in 1984, but it has had significant unintended consequences. The hugely attractive inheritance tax relief has driven up prices beyond what can be solely justified by the profit that can be earned from farming the land. It has been well reported that the population of active farmers is ageing, but it is very difficult for new farmers to get started due to the cost of land and difficulty in raising finance. Instead, farming has largely become a hereditary closed-shop – unless you are already very wealthy it is hard to get started without inheriting a farm from family. This is an unhealthy situation that does nothing for food security. If Labour stick to their plans, this should result in a fall in agricultural land prices. This will be hugely unwelcome for the multi-millionaires who invested in farming primarily as a tax dodge, but should be welcomed by ordinary farmers who intend to pass their farm on to family, and will also make it easier for new farmers to enter the industry.
So let’s campaign on the issues that actually affect British farming right now – reverse Brexit, oppose trade deals that undercut our farmers with low quality food, and put in place an effective support regime to properly replace the EU Common Agricultural Policy. But let’s not side with the very wealthy seeking to dodge millions in inheritance tax. There is nothing liberal about huge intergenerational wealth transfers for a very select minority.
* Nick Baird is a Lib Dem activist and Chair of the Liberal Democrats in Cheltenham.
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55 Comments
Thank you Nick for your support of the principle that wealthy investors in farmland should face inheritance tax. We do ourselves no good by failing to make that clear. I support also what you say about amendments to the proposals because there must be help for those families who inherit a farm but have little wealth or income. The figures are argued over but even a small number of such families should be supported and that is an error in the government’s proposals. It also shows a weakness in the IHT that does not take sufficient account of the situation of those who inherit wealth; it is the receiver that matters most for tax purposes surely.
Politically I also worry about the effect on what we say and do. We are at risk of helping those who are very right-wing, always arguing against tax and likely to increase support for Reform UK or very right-wing Conservatives. We must not do that.
Full support to Nick Baird. There was an informative article in Sunday’s Observer making much the same point and giving additional details. I’m so sorry to see both Ed Davey and Tim Farron (whom I greatly admire) jumping on yet another populist bandwagon. Liberal Democrats exist not just to stir up trouble for the government when the opportunity arises, but to campaign resolutely for a fairer society. That incudes fairer taxation for all, not continued opportunities for tax avoidance by the already wealth and exploiters of the private equity ilk.
The article is by Will Hutton:
https://www.theguardian.com/commentisfree/2024/nov/17/farmers-have-hoarded-land-for-too-long-inheritance-tax-will-bring-new-life-to-rural-britain
What we need is tax reform, and more determined action on tax avoidance (and evasion) through trusts and offshore ownership. Those like James Dyson (and many other really wealthy people) who have bought farmland to avoid tax should be caught; but smaller farms that are actually farmed by the owners should be exempt. This tax measure was intended to catch the former, but has frightened the latter. And there are many other forms of tax avoidance by the wealthy that need attention. Who dares tackle the Crown Dependencies, for instance (Jersey, Guernsey and IoM)?
Absolutely right, Nick Baird. Davey and Farron have allied themselves with Kemi Badenoch and with that rich self-confessed inheritance tax dodger, Jeremy Clarkson. It’s not a good look.
Labour have taken a baby step toward slowing down Britain’s massive shift toward increasing wealth inequality. It has brought them grief, because they haven’t thought it through well enough. Ironically for an (ex?) socialist party, they have failed to recognise the importance of class war, and that by far the most militant class warriors are the very rich. The tax dodgers have now managed to install Farmer Barnes as their honest-looking figurehead in their unrelenting campaign to keep rich people rich. The Lib Dems should not be helping.
The farmers’ dilemma is that they are wealth-rich but income-poor. The solution must be better support for agricultural incomes, not the preservation of unearned wealth by tax-dodging. Finally remember, for every farmer desperate to keep their family farming, there is another farmer desperate to sell to the highest bidder – a housing developer, a corporate, a carbon offset gamester – and gobble up their wealth. Lib Dems should not be helping.
Well done to Tim Farron and Ed Davey for standing up for the farming community This soul less Labour government is going to further alienate the 67% of the voters that didn’t want them. The seats of Labour MPs in rural constituencies must now be prime targets of the Libdems
Here’s a suggestion. Farm estates should be assessed for inheritance tax at the standard rate (40% on monies exceeding the relevant threshold), and a contingent tax liability in perpetuity registered against the land. Then, farmers’ executors should be entitled to apply for complete exemption from paying the tax liability provided that the land continues to be primarily used for agriculture. Whenever the land (or part of it) is sold, the new buyer should be required to reapply for agricultural exemption, or if they cannot validly do that, pay the accumulated tax.
If this is workable, it will mean the family farm can be kept going in perpetuity without paying any IHT – But once a farm is sold for £millions and taken out of agricultural use, the State will take a fair share of the unearned capital receipts.
The thing that most annoys me about this is that we didn’t fight anything like as hard against the real terms cut to the basic rate threshold, and have now completely given up on it now whilst labour are continuing the policy.
This was the most regressive and unfair tax rise since the poll tax (indeed the effect is near identical to introducing a poll tax).
We could have branded it the “Poor tax” and repeatedly brandished the figure that everyone would have to pay (the exact figure is the same no matter where on the basic rate scale you are, that’s how it hits the poorest hardest), yet there was barely a peep from us. But please let us not touch well off farmers!
I don’t have the expert knowledge to know whether the figures put forward by the Government (that very few farms will actually be affected) or by the farming lobby (that an awful lot of them will be) are the correct ones.
What I do know is that the propaganda being circulated from Tufton St includes downright lies. My (actually very good and conscientious) Conservative County Councillor recently circulated a briefing which included the statement that Agricultural Property Relief was being scrapped, which is a straight up lie. And the rest of the briefing was carefully crafted to give the impression that the changes were targeted at family farms rather than seeking to avoid them. The poisonous alliteration will, I fear, guarantee the expression “family farms tax” a circulation which “Clarkson/Dyson Tax Dodge Tax” lacks.
Surely the appropriate criticism of this change is that the threshold is arguably being set too low, rather than that the change is being made at all.
One of the reasons that farmers are asset rich and tax poor is that non-farmers can use farm land for tax-dodging. That is why a loss-making farm can still have substantial value. If this measure reduces the price of agricultural land, there will be even fewer working farms above the threshold and more opportunities for young people to get into farming.
If farmers don’t want to pay inheritance tax in ££ term they could be allowed to pay in % of land terms. So when the farm is eventually sold the ‘taxpayer’ would be entitled to a share of the proceedings.
In the meantime the farmer’s descendants will still be able to farm as normally. Perhaps a very modest rent could be charged to on the state’s share of the farm but it needn’t be anywhere near enough to drive anyone away from their chosen occupation.
> ” All that is true, but it has absolutely nothing to do with inheritance tax”
Unfortunately it does, as it does with many family businesses operated by sole proprietors.
Hopefully, many farmers and farming families will have taken this as a wakeup call and are now engaging with legal services and accountants who are experienced in farming to restructure their business into something that legally avoids Inheritance Tax.
> “The hugely attractive inheritance tax relief has driven up prices beyond what can be solely justified by the profit that can be earned from farming the land.”
Err no, the big driver for orders of magnitude increases in land value, is daft and unsustainable levels of house building. This means the large developers (who don’t pay Inheritance tax…) can afford to speculatively purchase and landbank in the sure knowledge that a council required by a central government dictate to build x houses, will be forced in the near future to permit development…
>”farming is vital to the country, that rural communities have been taken for granted…”
remember we produce circa 50% of our own food; which given the pressures on UK exports given Brexit and Trump’s dislike of the UK’s trade surplus with the US, is a good thing and is something we should be seeking to improve. Thus we need to make it easier for working farms to be sold/handed down to people who are going to maintain them as working farms – obviously, farming families have first hand experience of what is involved in running a farm, but also young farmers – ignoring like/dislike of Jeremy Clarkson, he has given Kaleb a platform, which Kaleb has used to promote the interests of a new generation of farmers and the challenges they face in becoming farmers.
I think David Allen’s suggestion has some merit in encouraging and protecting working farms from being eradicated by housing development, although additional funding etc. will be necessary to avoid them being overrun by solar panels, wind turbines etc.
@Peter Wrigley – The Will Hutton article presents an interesting viewpoint, but contains deeply flawed logic, which will only result in the further lose of agricultural land to urban development.
@Roland
“Err no, the big driver for orders of magnitude increases in land value, is daft and unsustainable levels of house building. This means the large developers (who don’t pay Inheritance tax…) can afford to speculatively purchase and landbank in the sure knowledge that a council required by a central government dictate to build x houses, will be forced in the near future to permit development…”
I think this is right. What would you do about the landbanking? Tax those doing it?
And aren’t there several hundred thousand empty properties scattered around the country? OK they might not all be in places with a high need for (affordable) housing.
Also on the central government requiring councils to build houses – households are getting smaller. Should people necessarily expect to start by buying a house much bigger than they actually need?
And what if the councik just doesn’t have the land available due (much of) it being protected (either defined as protected or liable to flooding etc)?
The tax on farming is 20% of the value with AT LEAST the first £1million exempt and 10 years interest free to pay it…
The rest of us pay twice that (40%) AND we start paying at £325k AND it has to be paid before probate is issued AND a delay in paying accrues interest…
AND the wealthy landowners have convinced small farmers that THEY are being victimised..
BTW…When I see Ed Davey standing on the same platform as Nigel Farage and Jeremy Clarkson I despair!
So the 16,000 or so protesters in London yesterday were all wrong, then? Because Badenoch and Farage jumped in on the act (the Tories having done nothing but damage to farmers for years), and because Jeremy Clarkson. I suspect a lot of farmers wished Badenoch, Clarkson et all had stayed at home.
It’s not about anyone ‘deserving a better deal on inheritance tax than you or me’. Or being better than others. ‘You or me’ perhaps face inheritance tax on a house we have no interest in when a relative dies. The sale of which will impact us not at all.
‘There are ways Labour’s plans could be amended..’ The fact they COULD doesn’t mean they show any intention of doing so….
.. Our MPs aren’t ‘siding with multi-millionaires’ any more than MPs concerned over the axing of the Winter Fuel Allowance are ‘siding with multi-millionaires’ (despite rich pensioners getting the allowance till now).
They are siding with land-rich, cash-poor farmers. And with tenant farmers, who face even greater insecurity than now when their landlords sell up to pay or avoid the tax.
And Tim Farron has been actively campaigning for farmers for many years, so hardly ‘jumping on a bandwagon’.
Will land prices fall? Perhaps. Not sure negative equity is always a good thing, especially if you’ve borrowed off the value of the land to fund the business.
But ‘let’s campaign on bad trade deals’ etc. Absolutely. A lot of the anger right now isn’t about the tax as much as it being the last straw for people who have have been treated so badly and dumped on by governments for years.
While the farmers are getting the publicity, Rachel Reeves’ real IHT raid is on those who have Defined Contribution pension pots (about 24 million DC pension contributors in the UK in 2020 according to the Pensions Regulator). With an median pension pot size at retirement of around £200k and the median UK house price of £300k in 2024, these alone will wipe out almost all of a couple’s zero-band IHT allowance which Reeves has now extended the freeze on until the end of this decade. Income drawdown with its risk of running out of money will become even less attractive to pensioners when the surplus in the pension pot is taxed as if a higher-rate taxpayer’s income, leaving only poor-value annuities. When are our MPs going to stand up for pensioners, who have been hit by a double-whammy from this Labour government?
“There is nothing liberal about huge intergenerational wealth transfers for a very select minority”
UK Inheritance Tax does next to nothing to address that. If it’s anything our tax regime is a tax on naivety and bad luck. If you wanted to end wealth transfers you’d tax all lifetime gifts but Labour is now encouraging lifetime gifting and tax avoidance. There are better ways to tax intergenerational transfers. Either a low flat tax on everything as it’s transferred (in Iceland it’s 10%), a tax on sale of inherited assets (20% in China) or, a winding up of the estate for CGT as if everything was sold subject to the testator’s relief entitlements (Canada) or maybe a carrying forward of base costs for future CGT liability according to the recipients’ allowances (Australia). The key feature of all of these is either than they’re small (as in Iceland) or that tax is paid when a sale is made and cash if available. There’s nothing liberal about keeping families beholden to bank lending.
@Laurence Cox – removing the pension exemption doesn’t hit pensioners in the slightest. They’ll be dead by the time the tax has to be paid. It just means some children will inherit a bit less money, but it needn’t impact current pensioner’s incomes.
It’s absolutely right to close this loophole, otherwise combined with the Tories removal of the lifetime limit on pension contributions, it would have been another way the very wealthy could shield a lot of money from IHT.
At least refreshing to see we haven’t just become an annex of the Labour Party.
@Colin Paine ..At least refreshing to see we haven’t just become an annex of the Labour Party…
We have just gone back to being an annex of the Tory party
Davey and Farron are right to oppose the removal of Agricultural Property Relief. The anger is due to Starmer’s promise not to increase inheritance tax on farmers as recently as the General Election in July of this year. The wider issue should have been discussed then. If the King and the Duke of Westminster do not pay Inheritance Tax, why should anyone else.
They would be right to call them out for breaking a promise and for making a promise they had no intention of keeping. That is no reason to oppose a fair tax.
Peter Davies, The old adage about ‘People in glasshouses…’, comes to mind..Tuition Fees, NHS reorganisation, Bedroom tax, etc..
@ Gwynn Williams “If the King and the Duke of Westminster do not pay Inheritance Tax, why should anyone else”.
A radical party would say that the King and the Duke of Westminster et al should pay inheritance tax…………….. and the Duchies of Lancaster and Cornwall should not be allowed to take the funds of intestate estates as they do now………. that’s what a radical party should and could say.
@expats The glass house we used to occupy in 2010 is currently occupied by the the people who were throwing the stones then. I see no reason to hold back.
Many of us are in agreement with the principle of properly taxing all wealth but aren’t in agreement with saying one thing before an election and doing something else afterwards.
Of course, the excuse for this, as with everything else, will be the so-called “black hole” of £22bn. I’ve heard it said that, if it didn’t exist, then Starmer and Reeves would have had to invent it. They have invented it though! £22bn is less than 1% of GDP. It’s not at all clear why this £22bn is mentioned so often and yet the other £100 bn or so of deficit we are likely to see this year isn’t mentioned at all.
Many of us did our best before the election to point out that Starmer has a poor track record when it comes to honesty. He’ll say whatever he thinks will get him a vote. Both the Tories and Labour did a very poor job of holding him to account before the election. He’s made all kinds of promises, sorry ‘pledges’, that he’s reneged upon. These range from abolishing tuition fees, implementing a realistic green climate policy, renationalising the utilities to maintaining freedom of movement with the EU.
gardless.
Don’t say you weren’t warned about giving a free pass to Starmer prior to the July election!
I support the principle that IHT loopholes for wealthy land-owners should be closed, and sympathetic to the reversal of artificial inflation of land prices protecting some farmers, but any policy that needs to be sold as fine because you can ‘pay a decent accountant to get out of it’ is not good.
It would have been much more politically smart to introduce this with a higher threshold that is far more obviously aimed only at the Lloyd-Webbers and owners of shooting estates, even if it means some of the wealthier farmers escape it for now. See if and how the value of land settles, and only then consider adjusting it down.
Apart from anything else, the government can’t afford to upset farming communities if we are to meet our climate and nature targets – and we must. Labour may have calculated that they don’t need votes from the rural constituencies to stay in government, but the only realistic way to make the changes we all need involves bringing farmers along for the ride.
Plus Labour have recklessly thrown the Tories a lifeline, and it’s manna from heaven for Farage/Reform. It would be a mistake to leave them to be the sole face of opposition to the policy, letting them expand their base while we instead attempt to defend a poorly defined Labour policy based on dry technicalities.
Fiona 21st Nov ’24 – 10:19am…It would have been much more politically smart to introduce this with a higher threshold that is far more obviously aimed only at the Lloyd-Webbers and owners of shooting estates, even if it means some of the wealthier farmers escape it for now. See if and how the value of land settles, and only then consider adjusting it down….
Fiona, I’d love to think so but I believe you’d just end up with ‘two rows instead of one’…
This Inheritance Tax row is a perfect example of the ‘Biscuit Theory’..Shown a plateful of biscuits the wealthy grab handfuls, leaving only one, and then tell family farmers, “Starmer is stealing your biscuit”..
Well done for raising this Nick Baird. Having Ed and Tim campaign to reverse (rather than adjust) the changes is very disappointing. The Labour proposals must hit some of the wealthy farms that should be taxed (but I suspect that the likes of Dyson and Clarkson who buy for IHT avoidance will not be affected by these proposals). As William Wallace says ‘What we need is tax reform, and more determined action on tax avoidance (and evasion) through trusts and offshore ownership.’ I do think though, unlike Nick Baird, that there probably is a case for special treatment for genuine family farms, some of these will be hit by the proposals.
We are an Opposition party are we not?
Maybe, but it’s as if the policy was written and announced in such a way to encourage the wealthy land-owners to deploy the biscuit theory diversion. I have sympathy with Reeves and accept the reason she is rushing in some crude policy changes is a response to the black hole, but this policy isn’t going to bring in much revenue to the treasury – certainly not any time soon, so there was little to lose and a lot to gain by taking the time to devise a more considered approach.
There are time when governments are justified in pushing through a policy that won’t land well with a particular demographic or the media, but there are times when it is important to think about how the comms will work, or the knock on effect on other policies.
Labour were in opposition for so long facing a monumentally terrible Tory Party, and now seem to have forgotten that translating ideas into workable policies requires consideration of the unintended consequences and the impact on other ambitions.
They are throwing away political capital to gain very little. There are so many things they could and should be doing when it comes to land ownership and how the countryside is managed for everyone – including protecting all farmers from bad trade deals and exploitative contracts with supermarkets.
Wouldn’t a sensible approach be to see what can be done to support farmers and ensure that family farming can be a sustainable, profitable business (such as, by taking action to prevent exploitative contracts with supermarkets) AS WELL AS ending the loophole on inheritance tax. The two things don’t seem to be incompatible.
Agreed Simon.
Personally, I think the risk of a few fairly wealthy farmers escaping IHT is acceptable if it meant buy-in from the wider farming community when it comes to targeting the actual property investors, and the very wealthy land-owners massive estates where farming is an afterthought. In particular, I’d love to see action against the environmental and social damage – and utter waste of land – from driven grouse moors etc.
I’d also like to see protections for tenant farmers. Some defenders of this legislation say they’ll not be affected, but I’m not convinced. More to the point – they aren’t convinced.
Fiona,
Sure, the Lib Dems should not defend Labour’s flawed though well-intentioned proposals. Sure, some sort of compromise approach which helps true farmers while curbing the rich tax dodgers makes better sense.
However, Davey and Farron didn’t have to go full Tonto with “Axe The Farmer Tax!”, did they? That’s crude populism. Lib Dems don’t need to match Badenoch and Farage on populism, whether it’s “Axe the Farmer Tax”, or “Stop The Boats”, or “Down with Wokeism”, or anythng similar!
I’m not defending their comments. I didn’t see Ed’s speech. I saw a bit of an interview Tim did, in which he was not defending the big land-owners, but talking about his conversations with small/tenant farmers who are worried. He said they were protesting about much more than was in this bill, and listed some of them.
There is a risk that in criticising the policy we appear to be defending the wealthy land-owners, but if we are too weak with our criticism then we will let the Badenochs and Farages dictate the narrative of what it is to be ‘pro farming’ and ‘pro countryside’.
Frankly, there’s no good response that adequately considers the issues that doesn’t leave us vulnerable to misquotes and bad faith takes from either the left or the right. I’m not defending anything or everything our politicians have said on this, just giving my view that Labour mucked up with this policy. It’s fine for Labour activists to try to justify in convoluted terms why it’s good for poor farmers, and I do think a minor tweak to raise the threshold would have avoided a lot of the current grief. But the onus shouldn’t be on us to try to salvage what is a poorly constructed piece of legislation.
@ Fiona “talking about his conversations with small/tenant farmers”.
If they are small tenant farmers, Fiona, they are unlikely to be above the qualifying IHT threshold.
1. We are an Opposition Party are we not?
2. We have seats to defend in rural areas?
3. I have not been in the party for 60 years to see us giving seats back to the Tories in those rural areas
4. Political common sense suggests we have adopted the right path, as with the VAT policy on Private schools no proper impact assessment has been undertaken, the actual savings and costs to the government not been properly assessed and the approach has been hedonistic, ignoring the effect on individuals the farming families and the children in private schools who are having to leave in a situation where there are no vacancies in the local State sector. I know this from personal experience
5. This government is quite authoritarian in its approach and we have a golden opportunity to take votes from them. We have to been seen as being in opposition to achieve this otherwise what is the point of our role. Agreeing with them will get us nowhere and lose hard earned parliamentary seats. The public need to see us as being different from the government.
6. Sometimes we have to be hard nosed, the parliamentary party is absolutely right in its approach and we should be supporting them, after all some Labour MPS are apparently against it as well.
@Nick Baird
They could have reintroduced the pensions cap, but that would have hit high earners in the Public Sector (like Consultant grades in hospitals) who have been choosing to retire early or work part-time because they could not put more into their DB pensions without being hit by a 55% tax on it. It’s actually quite easy to have put away well over £200k in a DC pension without ever having to have paid higher rate income tax; it’s the compounding effect of doing it for forty years or more. We’re not all bloated plutocrats as you seem to think, and I don’t see why people who are not even millionaires should be hit by a six-figure inheritance tax liability. It only encourages people to spend their income rather than saving it, which reduces the money in the country available for investment, going against Reeves’ avowed aims.
@David If they are small tenant farmers, Fiona, they are unlikely to be above the qualifying IHT threshold.
But many rent land which is owned by people/organisations that ARE above the threshold. And if the latter sell off land to reduce their liability, or pay a tax bill… THAT is what tenant farmers are worried about.
“If we are too weak with our criticism then we will let the Badenochs and Farages dictate the narrative of what it is to be ‘pro farming’ and ‘pro countryside’.”
Fair point, up to a point.
“Agreeing with (Labour) will get us nowhere”
Straw man demolished. Nobody on this thread “agrees with Labour”.
Come on, this isn’t rocket science. Here goes:
“Labour have made a complete mess of this. They have no idea how many farmers will be hit. They have no idea how hard it is to make a living on a farm. They should take these half-baked plans back to the drawing board. Stopping rich speculators from buying up land and dodging their taxes is fair enough – But it must not be done at the cost of wrecking our agriculture and killing off family farms.”
OK, no doubt the professionals could improve on my amateur effort. Shame it isn’t the road Lib Dems are travelling.
Lets get a few things straight:
“Agricultural Relief has not always existed, having been introduced in 1984, but it has had significant unintended consequences.”
The introduction in 1984 was part of a wider number of reforms which included removing certain grants and other offerings to farmers, to take one policy in isolation is simply dishonest.
“The hugely attractive inheritance tax relief has driven up prices beyond what can be solely justified by the profit that can be earned from farming the land.”
This again is acclaim that doesn’t hold water (one retired bloke form the LSE made this claim but the methodology is wrong). It shows price rises against the historic price of farm land not against other land and other assets. The explosion of asset prices is a huge economic skew bad monetary policy has done to the UK economy.
“our MPs siding with some very wealthy vested interests on this issue.”
One example you will see Labour and their cheer leaders throwing around is James Dyson. If anyone bothered to check he has structured his ownership in a way that he would never benefit from APR and this is irrelevant for his land holdings. Clarkson also will not pat tax as he will apply appropriate planning just as he will have done for his other assets.
Don’t worry as farmers sell off chunks of land they will get picked up by BlackRock and Bill Gates just like in the US. Then there won’t be any IHT due because the corporate structures that will hold them don’t die.
Nice and clean.
“Nobody on this thread agrees with Labour”.
No-one?
What we can say, with more certainty is, when it really mattered before the election, there weren’t many who were actively disagreeing with Starmer and Reeves and were holding them to account.
Lib Dems were giving Labour a free pass.
Whatever your views on the issue the position of Axe The Tax will, I suspect, bring a lot more Councilor victories in May.
Peter Martin – Just to be clear, when I wrote “Nobody on this thread agrees with Labour”, I was referring to the views expressed solely on this thread. Several posters have expressed some partial sympathy, but – not surprisingly! – nobody has given Labour’s specific proposals their support.
@Laurence Cox – it sounds to me like you actually oppose all inheritance tax. If so, you should make that case rather than argue for a series of exemptions until there’s nothing left to pay be anyone….
To others making the point that there are other ways for the wealthy to dodge inheritance tax – of course that is true. Maybe the broader point is whether, as a Party, we believe inheritance tax is fair and reasonable in principle. If so then we should support measures to tackle other means of avoidance too.
@FS People – “The introduction in 1984 was part of a wider number of reforms which included removing certain grants and other offerings to farmers, to take one policy in isolation is simply dishonest”
It would be, but if you read the article you will see that I specifically didn’t. For example – “So let’s campaign on the issues that actually affect British farming right now – reverse Brexit, oppose trade deals that undercut our farmers with low quality food, and put in place an effective support regime to properly replace the EU Common Agricultural Policy”.
@ Nick Baird
“if you read the article you will see that I specifically didn’t.”
Looking at your claim in the article.
“Agricultural Relief has not always existed, having been introduced in 1984, but it has had significant unintended consequences. The hugely attractive inheritance tax relief has driven up prices beyond what can be solely justified by the profit that can be earned from farming the land.”
Perhaps you can point out you explained the wider changes to policy around agriculture in the early 80s?
You seem to have taken all your information from people who are clearly dishonest. The claim of IHT changes being the reason for land price rises was an ex professor of the LSE, I would be disappointed if an undergraduate failed to correctly benchmark in that way, so a career professor is very unlikely to make such a obvious mistake.
Totally agree.
A very poor electoral judgement.
In 1926 my East Hampshire family quite literally “lost the farm” due to the suicide of my grandfather’s Dad, burdened by the debt, worry and isolation of farming. Farming can be a cruel business and Liberal Democrats have a proud record championing rural culture and mental health services.
Nick Baird, however, is exactly right. Big farmer, along with small care home owners (raking in dead cert local authority funding and paying peanuts to valiant staff) – it seems that we run into the arms of every passing producer interest without analysis.
I would have thought that the only reasonable historically-consistent Lib Dem ground for opposing the inheritance tax change would be on detail – for eg arguing for a change in the evaluation of ‘agriculatural land’ to differentiate active and non-active land (retaining an exemption for active land, possibly not at the same rate as now), possibly alongside pushing harder for land value tax or some kind of right-to-buy for tenant farmers.
Adjusting the ‘commercial landowner levy’ proposals to tax landowners of unused agrucultural land might also enable funding of the state whilst making it clear Lib Dems have no interest in driving tenant farmers or small farmers off their land.
I’d just like to see a bit of nuance from the Leadership on this (and other issues).
@Nick Baird
You are misrepresenting my position. I don’t oppose all inheritance tax, although I think that a lifetime gifts tax on recipients is preferable. The point I made, that you have completely missed, is that Reeves has struck at those who are now above the threshold for IHT by bringing pensions into estates. These are the people for whom it is not cost-effective to make use of clever tax-avoidance methods, but who can have enough in their pension pot to make income drawdown viable and who are now faced with either taking out a poor value annuity (insurance companies have to make profits too) or accepting an effective higher-rate tax charge on what is left in their pension pot when they die. You may think that because they are dead they won’t care; I understand that it will cause them worry before they die.