We spoke to two of our regular contributors to our agricultural research projects to ask them how they felt about the last three months.
Mark, 63, Arable farmer in Cambridgeshire
Mark is a fenland arable farmer in the East of England. Over his lifetime he was lucky to double the acreage of the farm and oversee massive changes that took the farm through increased automation and mechanisation from the 80's to the 00's as a high-production potato and root crop enterprise through to predominantly combinable crops and SFI schemes as Mark looked to slow down in his 60's. There is a succession plan in place as Mark's son plans to farm the land alongside his role as farm manager at a larger estate to a lesser or greater extent depending on how the next 10 years play out for farming.
Mark's own words when we contacted him to ask what the last three months in farming have yielded...
As I am just slightly over the average age of 59 for a British farmer the recent changes in IHT will have a dramatic impact on the sustainability of the farm businesses we have all been running for most, or all our working lives. For the 40% of British farmers over 65 who have been led to believe for years they would be able to pass on their hard-earned businesses to their family without the burden of IHT, the option of using the alternative seven-year exemption is fraught with uncertainty.
Apart from the concern of not surviving the full term by taking this route, is the loss of personal income to themselves it implies which they never had to plan for, as many believed their business would be able to support them until their demise. Now that has all changed, and the challenge facing the younger farmer hoping to inherit the family business is will the business remain viable if it must repay IHT on the scale that even the national average 270 acre will be burdened with.
To suggest that only a small proportion of farm businesses will be affected is wide of the mark as many family farms will have to sell land to meet the new rules, making them no longer economically viable and will wipe out most family farms within a generation. Perhaps this was an attempt to prevent a loophole for non-farming individuals passing on their wealth without IHT, but the impact is going to be felt disproportionately by working family farms who are being penalised for the price of farmland over which they have little control and from which they only benefit from if they sell up.
The low returns they glean with hard labour and long hours from this overpriced asset, cannot and will not give them the means to have a reasonable wage and pay off the incurred debt. What incentive for the younger farmer now, or even the ageing farmer to continue now? The sad thing is many will try because of the love of the land and a way of life now in peril.
Laurence, 28, Livestock farming in Northamptonshire
Laurence is a beef farmer in the midlands alongside his father as well as working part time at farm supplies retailer. As a younger farming entrant in his 20's with strong views on the impacts of the last three months on his further in agriculture, Laurence said....
The morning the budget came out, I had plans - dreams and ideas for the future. Plans to invest, to make our business stronger and more resilient. I had visions of increasing productivity on our farm to help boost national food production. There were plans for tree planting and hedgerow restoration - all of which now sit in limbo. The hammer blow came down from on high, feeling like yet another weight around our necks.
What's the point in encouraging the next generation to enter farming? The government claims their new IHT measures will tax wealthy farmers and lower land prices to welcome new entrants, but this simply isn't true. Instead, we're left facing a massive tax bill that we can only pay by either diversifying dramatically or selling off parcels of our land - reducing the farm's size and I will have to go find another job as the farm will not be able to support a full-time job anymore.
Since I was young, we've been told about global food security challenges, millions facing hunger worldwide, mounting pressures on the NHS from unhealthy and ageing populations, and a deteriorating environment. As an industry, we could help address these issues - sequestering more carbon to combat greenhouse gas emissions and producing healthy, sustainable food for the nation. But these ambitions must now be shelved as we're forced to focus on money, squeezing every penny from the industry to pay tax bills inflated by artificial land prices.
Take my father's recent investment, a life-long dream of his - a new livestock shed built to improve animal welfare and operational efficiency and replace the old pole barns. With this new IHT law coming into effect just two years after construction, the tax bill linked to this farm asset will be even more crushing than before. No parent wants to leave such a burden to their children. We're now actively discouraging hard work and achievement to satisfy the government's short-sighted goals.
The government has taken a sledgehammer to crack a nut but instead broke the table it was lying on - missing their intended target of those who invest in farmland purely to avoid IHT and instead devastating an entire industry. Many of us simply cannot afford this tax without breaking up our businesses.
Think of agriculture as a relay race passed down through generations. Drop the baton - decide to stop farming - and you can sell up, pay capital gains tax, leaving the next generation to seek employment elsewhere. Keep running, and you're saddled with an enormous IHT bill. We're a proud industry that doesn't want to let the nation down, nor let down the past generation who nurtured this land and invested sweat, money and sometime tears, but the government has done exactly that to us.
If Labour wants to be the party of the people, they've seriously miscalculated. They've lost the rural community's trust for at least a generation - not just because we're now the new tax generation, but because we're the ones who could have invested in new technology, innovation, and progress. Sir Keir Starmer and his cabinet have shown remarkable arrogance in this decision - truly the Grinches who stole farming's future.
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