Video: Labour backbenchers voice concerns over family farm tax

Labour’s rural backbench MPs have openly challenged their own government, warning that its proposed “family farm tax” risks inflicting profound and immediate damage on farming communities already under strain.

During a parliamentary debate on the Budget resolutions on Thursday 27 November, two Labour MPs – Tonia Antoniazzi and David Smith – delivered stark interventions that emphasised the depth of unease on the government’s own benches.

See also: Small inheritance tax concession for farmers in otherwise damaging Budget

Mr Smith, Labour MP for North Northumberland, broke ranks with the government, saying he remained “concerned about the long-term impact” of new upcoming inheritance tax (IHT) rules despite the chancellor’s adjustments.

He praised the retrospective transferability of allowances for widows as “a compassionate change” but said it did not solve the wider structural harm the policy risked causing.

Farmers in his constituency, he said, had made clear to him that the existing IHT system “meant stability” and allowed farms to pass between generations “without their work being interrupted by lengthy processes”.

Mr Smith read from a series of letters from distressed farmers, including one whose family now faces a £400,000 tax bill.

“We are a modest hill farm,” the constituent wrote. “We cannot make this kind of profit in 20 years, never mind 10.”

Mr Smith urged ministers to consider an “elderly farmer exemption” and called on the government to keep the policy “under review in its first two years” to prevent irreparable damage.

“Farmers need us,” he said. “They need stability, and they want a fairer system. There is still time to achieve that.”

Farmer wellbeing fears

Ms Antoniazzi, Labour MP for Gower, issued one of the most forceful warnings of the session, saying she was “really concerned” for the wellbeing of farmers in her Swansea-border constituency.

She welcomed the Budget’s limited concession allowing widowers to transfer IHT relief – but said it came nowhere near addressing the problems the government’s reforms would create.

“The idea that farmers do not pay tax is nonsense; of course they do,” she said.

“However, that change does not address the impact on the elderly and terminally ill, and it also penalises divorced and single farmers.”

In a deeply sobering disclosure, she told ministers that farmers were expressing thoughts of suicide because of the looming changes.

“If we can remove the anti-forestalling clause, especially for lifetime gifts, I will not be having phone calls and conversations with people… who may be thinking of taking their own lives before 6 April next year,” she said.

“This community feeds us – it feeds our nation – and it needs to have the ear of the chancellor.”

‘Go for the baddies’

Adam Jogee, Labour MP for Newcastle-under Lyme, also welcomed the Budget’s “sensible concession” on transferable reliefs for farming families, but warned ministers that the reforms risk sweeping up the wrong people.

“Going for the baddies who land bank is the right thing to do… but we must not allow an unintended impact on small family farms,” he said.

Growing pressure

Although Conservative MPs dominated the attacks on the “cruel” and “catastrophic” tax, it was the interventions from Labour’s own rural representatives that carried the greatest political weight.

It also signalled the likelihood of a sustained internal campaign to force a rethink.

For many farms, Ms Antoniazzi warned, “these are life-and-death conversations”.