皇家华人has today met with the Defra Secretary of State and Treasury officials to stress the significant impact of changes to IHT (Inheritance Tax), as outlined in last week鈥檚 Budget, would have on British food and farming.
In the meeting, Tom outlined exactly what this would mean for family farms across the country, the knock-on impact on homegrown food production, and the stress and anxiety these planned changes are causing.
Speaking about the meeting, Tom said: 鈥淚鈥檝e spoken to a huge number of our members in the past few days and heard some really upsetting accounts of what this tax would do to family farms.
鈥淚鈥檝e heard about distressed elderly parents who are having to apologise to their children in tears for something that isn鈥檛 their fault, telling them they鈥檙e sorry because they feel they鈥檙e now a burden on the family.
鈥淚鈥檝e heard from families who can鈥檛 see any way they can plan for a future which doesn鈥檛 result in losing their business.
鈥淢en and women who鈥檝e spent years building up farm businesses now wondering what鈥檚 the point in carrying on when it鈥檚 going to be ripped apart.鈥�
鈥淭he Treasury has got its figures wrong. This policy won鈥檛 protect family farms, it will do the opposite.鈥�
NFU President Tom Bradshaw
Treasury figures are wrong
The Treasury has said 73% of APR claims are below 拢1 million and so would be unaffected by this policy. However, Defra鈥檚 figures show that only 34% of farms are under 拢1 million net worth.
The Treasury鈥檚 figures are based on past APR claims and do not consider farms that have also claimed BPR for diversified aspects of their businesses.
They also include a substantial number of smallholdings, with 27% of those Treasury figures being for assets under 拢250,000, and another 23% under 拢500,000.
Very few viable farms are worth under 拢1 million. That could buy 50 acres and a house today. No viable food-producing business is 50 acres. The average farm in the UK is more than 250 acres.
Tom went on to say: 鈥淭hese are the working people of the countryside, and I made it clear to Defra and the Treasury today that there has been a clear miscalculation of the impact this will have on them.
鈥淭he Treasury has got its figures wrong. This policy won鈥檛 protect family farms, it will do the opposite.
鈥淭reasury officials have assumed that all previous APR (Agricultural Property Relief) claims are working farms, which is not the case. Nor did these claims include those eligible for BPR (Business Property Relief).
鈥淔ar from protecting smaller family farms, which is what ministers say they鈥檙e doing, they鈥檙e actually protecting private houses in the country with a few acres let out for grazing whilst disproportionately hammering actual, food-producing farms which are, on paper, much more valuable.鈥�
Discrepancy between figures
Tom added: 鈥淓ven Defra鈥檚 own figures show this, which is why they鈥檙e so different to the Treasury data this policy is based on.
鈥淲ith Defra data showing two thirds of farms could be affected, it was good to hear that the Treasury would look at the discrepancy in figures.鈥�
Threat to long-term food security
鈥淚 also asked if there were plans for an impact assessment of this policy on homegrown food production. Because if farms are being broken up and sold, British food will be hit. There is a very real threat to our long-term food security because there is no incentive to invest for the future.
鈥淲ith businesses already running on unsustainably tight margins 鈥� mass flooding meant that many haven鈥檛 turned a profit this year 鈥� compounded with further costs from National Insurance and National Living Wage increases, farming families have nothing left to give.
鈥淎t last year鈥檚 NFU Conference, we heard from Sir Keir Starmer that 鈥楲osing a farm is not like losing any other business, it can鈥檛 come back鈥�. He was absolutely right. It can鈥檛. And neither can its ability to produce food for the nation.
鈥淭hat鈥檚 why the only sensible course of action is for the Treasury to reverse this decision.
Mass lobby of MPs in Westminster
鈥淭he pressure is building. Defra and the Treasury are aware that on 19 November, NFU members will be making their way to Westminster to take part in our mass lobby of MPs.
鈥淲e will be looking them in the eye and asking them if they support this family farm tax, or if they will do the right thing for their farming constituents and support our call for it to be reversed.鈥�
