The CLA View

I met with many farmers, landowners and rural businesses from the East at the CLA’s national conference in London recently and the topic of the government’s planned changes to inheritance tax dominated conversations. New CLA President, and East Anglian farmer, Gavin Lane took to the stage to highlight our campaign against the proposals and addressed the ongoing concerns of our membership.

Speaking to a packed auditorium of farmers, landowners and rural businesses, he said: “The central contradiction any Government cannot escape is that they need you to invest. They need you to grow. They need the solutions that only long-term, well managed family businesses can provide. But their current position demands they strip you of the very thing—intergenerational stability—that makes that investment possible. You cannot ask people to pay to plant an orchard they'll never see grow, then tell them their children aren’t allowed to pick the fruit.”

His speech came just days before the Chancellor’s latest Budget in which we saw little movement from the government’s position. There was a minor concession from Rachel Reeves in that the £1m inheritance tax allowance can now be transferred between spouses - effectively doubling it for married couples. But this change goes nowhere near far enough to remove the devastating impact the plans will have on farming families and rural businesses and will not help the 46% of farms that are owned by a single farmer.

For a year, we have campaigned intensively against these inheritance tax changes. More than 275,000 members of the public signed petitions. Trade associations, including the CLA, representing 160,000 family businesses wrote to the Treasury explaining the unaffordability of the tax, and impact on the economy.

MPs from across the political spectrum have raised concerns. Independent tax experts have proposed sensible alternatives. Yet the Chancellor has chosen to press ahead with a policy that treats intergenerational asset transfer as a problem to be solved rather than the foundation of long-term rural investment.

After every Budget, a Finance Bill is brought to Parliament to enact the Chancellor's announcements. To begin that process, Parliament needs something called a 'ways and means' motion – this allows the government to bring forward the Budget's measures.

Occasionally, MPs recognise that a policy within the Finance Bill is so controversial it warrants a separate vote. This is what happened last week with the Agricultural Property Relief and Business Property Relief (APR and BPR) reforms (now known as Resolution 50).

The vote took place and Labour won, despite opposition from the Conservatives, Reform, and Liberal Democrats. Nevertheless, it revealed some interesting information. One Labour MP, Markus Campbell-Savours, formally voted against the resolution, because Labour had promised constituents during the election that they would not reform inheritance tax. In doing so, Labour removed the whip from him, effectively expelling him from the parliamentary party.

Interestingly, around 80 Labour MPs abstained from voting. Some of these abstentions were for due to things like overseas diplomatic trips, industry or constituency functions. However, we believe around 30-35 Labour MPs abstained because they did not want to support the IHT reforms.

The CLA’s tenaciousness will ensure the issue remains high on the political agenda. And I would encourage everyone who has concerns about the government’s plans to continue to write to MPs, invite them to your rural businesses, and demonstrate the damage the proposals will have on you.