Tag Archives: inheritance tax

A longer read: Lib Dem MPs are right about “Tractor Tax”

 Meet Llewellyn (not his real name). Llewellyn was a farmer I met in my old job and the National Farm Research Unit. The job I used to pay bills when I was representing Woodbridge as an (unpaid) town councillor. I called farmers with surveys and hoped that they would be nice to me (sometimes they were…).  

Llewellyn’s wife picked up. She, like him, was in her 80s, though she could barely speak a word of English. See the people in rural Gwynedd have performed the same job as their ancestors have in the same place since the late stone age. In fact, the farmers of Gwynedd are the people closest related to those that built stone henge – a fact proven by genetic analysis of skeletons. Not sharing my Anglo-Saxon heritage, Llewellyn’s wife was Welsh monolingual. 

Thankfully for my job, Llewellyn was not.  

He told me that he hadn’t been on a holiday for 25 years. The reason being was that Llewellyn annual income was £13,000 a year. Llewellyn’s land (the mountain the other side of Snowdon) was very expensive. Apparently, it could be sold for holiday homes for an enormous profit. The NFU has said that this makes 80-something Lewellyn fair game for Labour’s changes to inheritance tax.  The government disputes this suggestion. Insisting that their own research was in all ways superior to the professionals and peer-reviewed organisations that state the contrary.  

The situation is muddied by the Institute for Fiscal studies admitting two factors which spells potential doom for our agri-sector: 

  1. ‘Nevertheless, in some cases will simply yield too little income (and the inheritor will have too few other resources) to pay the tax. The owners might choose, or be forced, to sell part or all of the farm.’ 
  1. ‘The exact number that will be affected is uncertain but government figures imply it will be significantly less than 500 estates per year…’ 

Labour insists that marking their own homework is a worth-while enterprise. I (and most farmers) disagree.  

In a post-Brexit, post-truth world it is clear that facts and expert opinion no longer carry the weight in public discourse that they once did. In much the same way that the last government crusaded against doctors and health-care workers, this government has chosen farmers.

No less defensible (and arguably crueller) the “Bus Tax”  will remove mobility and agency for thousands of rural working people.  

It seems that many commenters on social media were to be believed believe that farming is enormously profitable. Most farmers hold a title, a castle and probably a butler. We’re all multi-millionaires, don’t you know? 

Posted in Op-eds | Also tagged , and | 31 Comments

25 November 2024 – today’s press release

IFS family farm tax: Government needs to swallow their pride and axe the tax

Responding to the IFS suggesting that the Government changes its proposals to farmland inheritance tax, Liberal Democrat Environment spokesperson Tim Farron MP said:

The Government hid behind the IFS to try and justify this disastrous policy. That very same organisation is now telling them that their own proposals need an overhaul.

It would be beggars belief for the government to continue to push forward with these stupid plans.

They need to swallow their pride, realise the damage this family farm tax will do and axe the tax.

Posted in News and Press releases | Also tagged | 10 Comments

Lib Dem MPs are wrong to campaign against farming inheritance tax changes

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.

Posted in News | Also tagged , , and | 55 Comments

Opinion: Time to give inheritance tax the chop

Whilst on my weekly perusal of Lib Dem Voice I spotted an interesting article by my lovely colleague Stuart Bonar. He was discussing inheritance tax; an issue that I hope will not affect me for a while, but nonetheless, an important one to many of us. I was initially inclined to agree with Stuart’s view that individuals should be taxed on these ‘wind-falls’ but then I got thinking…

Inheritance tax used to be a tax on the rich, something not relevant to most of us. But it’s now a tax paid by many, as house and asset prices have risen to extraordinary levels; many being valued at over £325 000, which is the threshold for this tax. However, I do wonder whether many of the rich, the original subjects of this tax, pay it, as they can afford expensive and skilled accountants or leave the country to escape this payment, something that I and many others cannot do.

Posted in Op-eds | Also tagged | 105 Comments

Opinion: A brave tax proposal

Back in June Mark Pack suggested that now is a good time to start debating tax ideas for the next manifesto. So, let me throw in two ideas: one brave, one not so brave.

Ready reckoners published online by HM Revenue & Customs make it easier to play the role of armchair Chancellor, so that is exactly what I am going to do.

My first idea is to increase inheritance tax by 5% to 45%, raking in an extra £350m, and then spend £300m of that to cut the reduced rate of VAT to 4%.

Posted in Op-eds | Also tagged and | 16 Comments

Opinion: Inheriting Tory Tax Plans

Nobody likes paying tax. But most of us accept the necessity of paying collectively for public services, and the moral obligation on those of us with good incomes to subsidise these services for those without. Most of us would also accept that, in times of serious budget deficit, any adjustments to the tax system should be made in favour of those who are, firstly, of the most limited means, and, secondly, alive.

It’s easy to make inheritance tax sound unfair. Just describe it as “double taxation”; a second tax on income which has already been taxed. But …

Posted in Op-eds | 8 Comments

Tory tax priorities: spend £6 billion on the wealthiest 0.8% in the UK

Small wonder that Tory leader David Cameron publicly rowed back on his inheritaance tax cut for millionaires in last week’s televised debate – Lib Dem research released today shows the Tories’ promise would:

  • cost £6bn over the course of the next Parliament;
  • is aimed at the wealthiest 0.8% of estates in the UK; and
  • would benefit 3,000 of the wealthiest estates in the country every year by almost £250,000

As Vince Cable points out:

At a time when the gap between the richest and poorest is so great, it beggars belief that David Cameron wants to give the

Posted in General Election | Also tagged , and | 5 Comments

Cameron’s confusion over Tory marriage tax plans

It can be hard pre-launching an election campaign, can’t it? Here’s the PoliticsHome rolling news front page from today:

At 3.04 pm, the site reported:

David Cameron said he could not guarantee a Conservative government would be able to offer a tax break to married couples, despite having personally supported such a move. “It’s something within a parliament I would definitely hope to do,” he said, but insisted the state of the public finances prevented him from offering any guarantee. “We’re not able to give people absolute certainty

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Vince: Tory sums do not stack up

Lib Dem Shadow Chancellor Vince Cable has wasted no time in pointing out the huge gaps in the arithmetic of the Conservatives’ draft election manifesto. Earlier today, at the launch of the manifesto, David Cameron stated that his proposed inheritance tax cut would be paid for by taxing non-doms, saying:

“Every other spending pledge we have made, every tax pledge we have made, is fully costed and fully set out. If you take for example the pledge on inheritance tax, which we’ve said is not for a first budget but is a pledge for a parliament, that is to be paid for by taxing the non-doms, the people who live here but do not pay full tax here.”

However Vince was critical of both the principle of the inheritance tax cut and the Tories’ sums. He pointed out that the annual gap between the revenue from non-doms and the lost inheritance tax will grow from £350 million in the first year of the next parliament to almost £1.5 billion by 2015, a total of almost £6 billion. He said:

Posted in News | Also tagged , , and | 2 Comments
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