Westcounty MPs rally against new inheritance tax on farms

MPs across the West have blasted plans to introduce an inheritance tax on farmers.

The region’s MPs were part of a debate on the budget implications for farming communities in the House of Commons on Monday, November 4.

Debate was focussed around plans that from April 2026, inherited agricultural assets worth more than £1m, which were previously exempt, will have to pay inheritance tax at 20% - half the usual rate.

Defending the move, Daniel Zeichner Minister of State at the Department for Environment, Food and Rural Affairs said: “As we are all only too aware, the Conservatives left behind a £22 billion black hole in our nation’s finances this Government have had to take tough decisions on tax, welfare and spending to fix the foundations and deliver change, including a series of decisions on tax to protect the payslips of working people.

“That is possible only by making changes to other taxes, such as agricultural property relief, which was previously available to all agricultural property at a rate of 100%. Currently, small farms can find themselves facing the same levels of tax bills as much larger farms, despite having a much smaller asset. Twenty per cent of agricultural property relief is claimed by the top 2%; 40% is claimed by the top 7%. That is not fair, it is not sustainable, and sadly, it has been used in some cases by wealthy landowners to avoid inheritance tax. That is why the Government have announced plans to reform agricultural property relief.”

Richard Foord, Lib Dem MP for Honiton & Sidmouth said: “Family farms are very often cash poor. Each time the average farm is passed from a parent to a child, the family may have to generate an extra half a million pounds. They may deal with that by trying to make each acre produce an additional £40 of profit. That could send into reverse the agricultural transition to a more nature-friendly farming approach, if they revert to more agrichemicals and intensive methods. As I asked the Minister in an Adjournment debate last week, what did he do ahead of the Budget to combat this appalling measure?”

Mr Zeichner responded: “What we did was look at the farming budget and ensure that we protected it, to allow his constituents and constituents across the country to take part in the schemes that will support them in that important transition.”

Jayne Kirkham, Labour/Co-op MP for Truro and Falmouth said: “Before the election, farmers in my constituency were very concerned about the environmental land management system, which had not worked for a long time but which they felt was just beginning to work. Will the Minister please reassure them that the Government will be proceeding with it?”

Mr Zeichner responded: “As I said earlier, throughout the last five years in opposition, I was a consistent supporter of the agricultural transition, and I am determined to ensure that it is successful.”

Caroline Voaden. Lib Dem MP for South Devon read out a statement from a farmer in her area which said: “We may be land rich but we are cash poor and our children will more than likely have to sell the land and maybe buildings to cover the tax. Without the land, the farm is simply no longer a farm, taking valuable land out of food production.”

Mr Zeichner explained that it could be avoided through ‘proper planning’ adding: “Devon is one of the counties where we most often hear it said that people are coming in and buying up land for the wrong reasons.”

Meanwhile The speaker of the House of Commons, Sir Lindsey Hoyle, has accused Tiverton & Minehead MP Rachel Gilmour of ‘playing politics around the Chamber’ during the debate.

Ms Gilmour said: “I have 1,600 farmers in my constituency. Some 432 farms will be affected by this silly idea, not to mention the families, their employees and the shopkeepers who rely on our rural economy. This policy is insensible, irrational and plain wrong in its interpretation of real life in our rural communities. It will be like the highland clearances.

“Hundreds of years of tradition will be lost to the taxman. Before I ask the Minister to think again, I can say with absolute certainty that the policies of the Conservative and Labour parties have reaffirmed the fact that the Liberal Democrats are the only true champions of farmers and the countryside…”

She was interrupted by the speaker who said: “ Sit down, please. The question was long enough. We do not need to start playing politics around the Chamber.”

In response Daniel Zeichner said: “I do not recognise those figures. When I look at the figures that the Treasury gave for the number of claims in the last year available, that is very close to the number in the hon. Lady’s own constituency, which seems unlikely to me.”

Ms Gilmour posted this part of the debate on her social media but omitted the interjection by The Speaker and response from the Labour minister.

James Wright, an Exmoor farmer and South West Chairman of the Conservative Rural Forum said: “Being publicly rebuked by the Speaker is bad enough, but trying to cover it up is a betrayal of trust. Tiverton and Minehead deserve honesty and integrity from their MP—not political games. If Ms Gilmour truly wants to represent us, she needs to stop playing politics and start delivering real results.”