It’s the final nail in the coffin of every family farm – a shocked Andrew Livingston responds to the Budget’s tax reforms
Is this the end? Is this when we finally say goodbye to the family-run farm? Does the new Labour government even really care?
I certainly don’t think they get it.
We’d been waiting on tenterhooks for it. The government that was essentially voted in purely because they weren’t the other bunch of buffoons appears to have ended farming as we know it.
In August’s edition of the BV, I spoke of my worry and fear that the Government was going to cut subsidy funding for farmers. I was scared that withdrawing the cash was going to kill the smaller family-run farms. And, to Labour’s credit, in Rachel Reeves’ budget yesterday was an announcement that there was to be no decrease in the subsidy funding, and instead there would be a rise to cover the shortfall in spending that the last lot of Westminster busybodies failed to dish out.
So far so good.
What came next for the farming sector was shocking … genuinely shocking. The removal of the Agricultural Property Relief (APR).
The APR is essentially a protection to ensure that when farm owners die they can pass the land on to their children without having to pay extortionate inheritance tax fees that would cripple the farm.
The Labour government, in its wisdom, has announced that estates will now be protected only up to a value of £1m. I’m sorry… what?
Have they looked at the market? An old farmhouse on its own is worth a million, and that’s without adding a garden, let alone enough land to work on!
Of course, this wouldn’t be an issue if there was some money to be made in farming.
Government ministers must just look to farmers and think, “They live in the countryside. They must be minted … let’s take a bit of their money!”
The wealth misconception
According to DEFRA, the average farm income dropped from £20,000 to £17,800 in 2023. Farm incomes are consistently lower than the average for UK households, and this gap has been growing over the past decade. Farming incomes are now roughly half of what the typical UK household earns. A very quick search found a 225 acre farm outside Bridport, on the market right now for just shy of £4m. It has land and some agricultural buildings, but that price won’t include any farm machinery or equipment. Thanks to the Chancellor, if that farm was passed down to the next generation to keep it in the family there would be a £300,000 inheritance tax bill.
Which works out at £1,333 per acre: last year, a crop of wheat made £75 an acre. How is that going to cover a £1,333 an acre tax bill?
Well, it won’t. Obviously.
In fact, it would take nearly 20 years to pay off – and by then you are dead from the stress of not being able to provide for your children … and the vicious cycle continues.
Up and up and up
I haven’t even touched on the raising of the minimum wage. Of course it’s a great idea for the Government to give people more money. But the rise is three times more than inflation: I’m not an economist, but even I understand that all this is going to do is drive inflation!
How are businesses going to cover the cost of those wages rising? Well, of course they’ll make everything more expensive. Everything in the shops is going to start to go up more in price … best start hoarding tins and start stockpiling for the apocalypse.
You know what really made me scream into my clenched fist? The rich elites all laughing and cheering when Rachel Reeves announced she was going to reduce the draught beer tax by 1.7 per cent on pints in our pubs. To which Reeves happily said: “Which means a penny off a pint in the pub!”
Which is just great. Farmers can’t afford to keep their farms after their parents have died … but hey, at least I can get a pint a penny cheaper.
Well done. Well done.
Someone stick a pitchfork in me.
I’m DONE.
