Farmers and Labour MPs unite over family farm tax fears

Farmers and a growing group of rural Labour MPs are set to escalate pressure on the government this week, uniting publicly to demand last-minute changes to the “family farm tax” ahead of the Budget.

They will assemble outside Westminster at lunchtime today, eight days before chancellor Rachel Reeves delivers her Budget on 26 November, in what organisers describe as an unprecedented show of cross-rural solidarity.

In a related move, Oxfordshire mixed farmer David Passmore will bring a cow to Parliament Square – nearly a year after he led the same animal there as a symbolic reminder to government that farmers have not gone away in their fight to overturn  inheritance tax (IHT) on farms.

See also: Conservatives demand urgent IHT reversal ahead of Budget

Today marks the eve of the anniversary of the London Farming Rally (19 November 2024), when tens of thousands of farmers gathered at Parliament Square in Whitehall to protest against the planned agricultural IHT policies, dubbed the “family farm tax” by the NFU and others.

Merseyside farmer Olly Harrison, one of the co-organisers of last November’s rally, announced on his YouTube channel Olly Blogs Agricontract: “As you know, last November we were in London, 45,000 of us, including Jeremy Clarkson as well, in Whitehall.

“We are there a year to the day to mark the anniversary and say you still need to start listening. Agriculture is still being damaged by this policy.”

Year-long battle

For the past year, farmers have been raising concerns about proposed IHT reforms, warning that altering long-standing reliefs risks irreparably damaging small family-run farms.

While disquiet among Labour’s rural backbenchers has been an open secret for months, today’s intervention represents their first co-ordinated, public effort to press the Treasury to rethink.

The coalition of farmers, industry groups and MPs is expected to call for the government to raise the proposed £1m tax-free threshold, arguing that current plans would leave many modestly sized but asset-rich farms facing unaffordable one-off bills.

Alongside the tax issue, farmers are also seeking a stronger voice in shaping agricultural policy at a time when many are experiencing persistent low profitability, with some even claiming tax credits to cover day-to-day living costs, despite high paper land valuations.

Herefordshire farmer Martin Williams will say that the government’s direction to date has dampened investment and threatens the resilience of family farms.

“Good government policy would help to increase agriculture’s contribution to the country’s Gross Domestic Product, but the major policy decision taken by this government to-date has stifled ambition, slowed investment and will be detrimental to the next generation of genuine family farms,” he said.

He added that while the wealthy should contribute fairly, the proposed £1m IHT threshold – which would leave farmers paying 20% tax on inherited agricultural assets –  is “too low”. “It’s the winter fuel allowance all over again,” he said.

United front

At a press briefing later today, farming organisations will appear alongside members of Labour’s 35-strong Rural Research Group. Labour MPs are expected to reinforce the message.

South Derbyshire MP Samantha Niblett said: “I have heard from so many of my farmers who are pleading with me to continue pressing the government to pause on their proposed changes to IHT.”

Maya Ellis, MP for Ribble Valley, will add that the party has “a once in a generation chance” to demonstrate fairness for rural Britain.

Another Labour MP said their farming constituents “fear this policy will cause the death of some family farms, stifle rural investment and growth, and undermine our national food security”.

The MP added: “They [farmers] are not asking for a U-turn, but for tweaks and safeguards.”

Call for rethink

Simon Orson, a farmer based in Melton Mowbray, Leicestershire, and spokesman for the Midland Farmers group, said: “Farming is the backbone of our rural economy.

“We urgently call on the prime minister to show leadership and to heed the calls of dozens of his worried MPs who we know have tried repeatedly to secure policy adjustments.”