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Agricultural Property Relief
28 January 2025
Lead MP
Ann Davies
Caerfyrddin
PC
Responding Minister
Torsten Bell
Tags
Taxation
Word Count: 13553
Other Contributors: 20
At a Glance
Ann Davies raised concerns about agricultural property relief in Westminster Hall. A government minister responded.
Key Requests to Government:
The hon. Member asks the Government to provide adequate data on the particular effects of these changes in Wales, ensure that consultations are made with industry experts before any policy is announced, and consider a fairer and more appropriate solution for family farms or the wider industry.
How the Debate Unfolded
MPs spoke in turn to share their views and ask questions. Here's what each person said:
Lead Contributor
The UK Government’s decision in the autumn Budget to change agricultural property relief and business property relief will have a real effect on food, sustainable food production, and food security in Wales. The changes could affect around 90% of farms that produce nearly 90% of agricultural output in Wales according to Eirian Humphreys of LHP Accountants.
Adrian Ramsay
Green
Waveney Valley
Farmers in Adrian Ramsay's constituency are facing a dilemma due to the high on-paper values of their farms and non-farmers buying up agricultural land. He supports increasing the threshold for inheritance tax relief but criticises those arguing for the status quo.
Mid Sussex
Farmers in her constituency are worried about losing their farms due to high land values and relatively small farm sizes. Urges reconsideration of the £1 million threshold as it will be detrimental to the rural economy.
Aphra Brandreth
Con
Chester South and Eddisbury
The hon. Lady expressed concern over the impact of the policy on family farmers in north Wales and their associated businesses, mentioning Meadow Foods as an example.
Charlie Dewhirst
Con
Bridlington and The Wolds
The policy is uniting all people against one single measure, with the AHDB analysis saying that over 75% of farms will be affected by this measure—three times the amount that the flawed Treasury modelling said. This will take land out of production, risking both our food security and local agricultural economies.
Brecon, Radnor and Cwm Tawe
Emphasized the financial struggles of Welsh farmers due to rising costs and policy changes. Highlighted the potential impact of changes to APR and BPR on 75% of farms in Wales.
Roz Savage
LD
South Cotswolds
Commemts on the stress added to farmers already under pressure from financial and climate change mitigation responsibilities.
Helen Morgan
LD
North Shropshire
Agrees that increasing the threshold and raising rates for very wealthy landowners could have achieved Treasury's outcome, but would not support this route.
Jamie Stone
LD
Caithness, Sutherland and Easter Ross
Expresses emotional attachment to farming land and highlights difference between buying/selling land for fiscal purposes versus family-owned farms. Suggested that the policy could lead to the forced sale of farms due to heavy borrowing and foreclosures by banks. Points out that the issue disproportionately affects Northern Ireland due to higher land prices compared to Scotland or England. Stressed the emotional importance of land to farmers and farming families, emphasizing the need for inheritance tax relief that supports family farms while acknowledging the broader context of public finances and services.
Jim Shannon
DUP
Strangford
Emphasized the importance of farmers in rural communities and expressed concern over the financial burden placed on farming families if APR were removed. Highlighted that approximately 70% of farms in Northern Ireland would be affected. Emphasises that raising the threshold from £1 million to £5 million would save family farms and addresses concerns specific to Northern Ireland where land values are higher. Urges the Minister for clarity and reassurance. Critiqued the rateable value system used in farm valuations, suggesting it does not accurately reflect current land values.
John Glen
Con
Salisbury
Acknowledged the right hon. Gentleman's assessment of the Treasury, suggesting that civil servants have multiple options to address inheritance tax changes affecting agricultural communities.
John Lamont
Con
Berwickshire, Roxburgh and Selkirk
The hon. Gentleman cited research by Scottish Land and Estates showing that the average working farm in the UK is worth about £1.8 million, questioning the Government’s argument that this policy targets only the richest landowners.
Llinos Medi
PC
Ynys Môn
Discusses impact of changes on tenant farmers in Ynys Môn, highlighting loss of homes, businesses, and future for generational farming communities.
Orkney and Shetland
The right hon. Gentleman raised concerns about the number of estates affected by the changes, arguing that the impact is likely to be much greater than the UK Government’s estimate of 500 estates annually. Discussed the complexities of agricultural property relief, business property relief, and inheritance tax implications for family farms. Raised concerns over HMRC guidance and Treasury calculations not including all affected farms as per AHDB's report.
Carmichael
LD
Orkney and Shetland
Pointed out practical difficulties for farmers with a £400,000 inheritance tax bill despite the 10-year payment period.
Tiverton and Minehead
Stresses that 75% of working farms will be affected by the changes, highlighting specific examples such as Great Ash farm in her constituency which exceeds the £1 million threshold.
Robbie Moore
Con
Keighley and Ilkley
The Government's policy on APR is seen as a vindictive approach towards the farming community. Despite claiming that only 27% of farms will be affected, research indicates that up to 75% of commercial family farms will face significant challenges due to increased inheritance tax. Interrupted Torsten Bell, questioning why the Government does not consider the value and size of agricultural units when projecting impacts on family farming businesses.
Rupert Lowe
Reform
Great Yarmouth
Farmers would have voted for Labour specifically on that pledge from the Environment Secretary. They certainly would not now. We should call it what it is: an outright betrayal. The assault on British family farms will undermine our food security, making our already uncertain place in an increasingly dangerous world even more precarious.
Steve Witherden
Lab
Montgomeryshire and Glyndŵr
Steve Witherden highlights the impact of changes to Agricultural Property Relief on family-run farms, particularly a case in his constituency where a lifelong farmer's son may lose control of the farm due to inheritance tax. He calls for raising the threshold and an exemption for elderly farmers who are too late to plan for these changes.
Torsten Bell
Lab
City of London
Responded to concerns about the inheritance tax changes, emphasizing that agricultural property relief and business property relief will continue with significant support for small farms. Raised concerns about supermarkets not supporting farmers and the need for reform of reliefs to stabilise public finances.
Victoria Atkins
Con
Louth and Horncastle
The shadow Secretary of State raised concerns about the Government's failure to record farm suicides, indicating a lack of proper assessment regarding the human impact of policy changes.
Government Response
Torsten Bell
The Parliamentary Secretary to the Treasury
Government Response
The Minister acknowledged the importance of the debate and thanked MPs for their contributions. He explained the necessity of reforming agricultural property relief due to unsustainable public finances, stating that rural communities suffer disproportionately when public services fail to meet standards. The Minister noted that maintaining significant levels of inheritance tax relief for agricultural property is essential while recognizing its role in supporting farmers. He addressed concerns about balancing objectives of protecting family farms with public finances and highlighted the skewed benefits towards wealthy estates, mentioning 40% of relief going to the top 7% of estates. Discussed reforms to agricultural and business property relief, stating that they will not be scrapped but continue to provide generous support. Emphasized that up to £3 million can be passed on free of inheritance tax for a couple. Highlighted the government's commitment of £5 billion to farming over two years and additional support measures.
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Assessment & feedback
Summary accuracy
About Westminster Hall Debates
Westminster Hall debates are a chance for MPs to raise important issues affecting their constituents and get a response from a government minister. Unlike Prime Minister's Questions, these debates are more in-depth and collaborative. The MP who secured the debate speaks first, other MPs can contribute, and a minister responds with the government's position.