For over ten years, the Countryside Alliance has been urging the Labour Party to mend its relationship with rural areas. When Keir Starmer spoke at the National Farmers Union conference last year and promised a “new relationship with the countryside,” I thought the party understood how important it was to win back the trust of rural voters.
After the General Election, Labour managed to win several rural seats, and many of us who had worked hard to rebuild that trust were hopeful for a positive relationship between rural communities and a Labour government.
But now, it feels like all that hard work has been undone by one decision. Rachel Reeves’ plan to raise inheritance tax on farms might be a misunderstanding, but it could have serious consequences for farmers, just like the long-standing debates about hunting.
I farm on Exmoor, and on paper, my neighbours’ farms are worth millions. But if you met them at the market, they wouldn’t think of themselves as wealthy. The value of their land doesn’t matter to them because they have no intention of selling. Their goal is simply to pass the farm on to the next generation, in good condition. Farming may provide a modest income, but it’s nothing like the wealth people might assume from the land’s value.
Farming is a tough business. The profits are low compared to the land’s value, but that’s just how farming works. However, as demand for land grows for things like rewilding, carbon offsetting, and renewable energy, the price of farmland keeps rising.
Some people, not even farmers, have been buying up farmland to take advantage of tax breaks. Farms have been exempt from inheritance tax because governments know that taxing them would force families to sell up, breaking the farming tradition that’s so vital to rural life.
While it’s important to stop people from using these loopholes, the policy Rachel Reeves has suggested doesn’t protect family farms. The inheritance tax threshold she’s proposed is far too low, and now many farmers, including my neighbours, are worried that their farms could be lost if they die at the wrong time.
That’s why, on Tuesday, thousands of farmers will be protesting in Westminster and talking to Labour MPs. We’re not asking for the government to back down completely, but we want to make sure that, while tackling tax avoidance, Labour also protects the family farms that are the heart of the countryside.
If they don’t understand the impact this could have on farming and their relationship with rural communities, it could be a huge political mistake.
