By Andy Yorke
Last month 10,000 farmers and supporters protested against Labour’s plans to introduce inheritance tax on farms, ending a decades-long exemption which has transformed farmland into a notorious tax-avoidance scheme, and driving up prices into the bargain.
The powerful farming lobby ensured the protest received disproportionate news coverage, but this only guaranteed that the totally reactionary and self-interested motives of the big landowners leading the protest were amply demonstrated.
Former Top Gear presented Jeremy Clarkson (net worth £60 million) ranted that ‘communist’ Labour had a sinister plan to ‘ethnically cleanse the countryside of farmers’ in order to make way for ‘new towns for immigrants and net zero wind farms’. Tory peer Andrew Lloyd Webber (net worth £659 million), let the media know that he was marching for small farmers who would be forced to sell up to ‘foreigners and outsiders’.
Tory leader Kemi Badenoch pledged to reverse the measure, but Nigel Farage, whose Brexit project has done considerable damage to farming, was present but considered too divisive to speak.
Special pleading
Disputes around how many farms will be forced to pay the tax centre on different calculations around the abolition of Agricultural Property Relief (APR), which farmers benefit from, and the Business Property Relief, which is afforded to all businesses. The Institute for Fiscal Studies suggests that less than 500 farms (2%) would be affected and that ‘simple tax planning’ would avoid much of this, leaving ‘land much more lightly taxed than most other assets’.
This simple fact underlines the rank privilege at play. Inheritance tax (IHT) will now be payable at half the standard 40% rate on estates worth more than £1 million. Personal exemptions permit up to £3 million to be passed on. Estates passed on seven years before death incur no tax at all. The tax will be payable over 10 years, interest free—another privilege not applied to any other business. Added to this, the vast majority of landed estates are exempt from death duties under ‘conservation’ rules subsidising their palaces at public expense.
Worst of all this demagogic campaign by big landowners has served to obscure the parlous financial state of much of British farming.
Nearly half of British farms are smaller than fifty acres. The majority of farmers are owners now rather than tenants, but farming income is utterly dependent on state subsidies, formerly from the EU. Official figures show just 7% of claims for APR accounted for 40% of the total IHT relief, while 2% accounted for nearly 25%.
Socialists support taxes on the wealthy in order to fund universal public services and infrastructure which benefits both town and country. Rich landowners who live jet set lifestyles and bank land to dodge taxes are the real menace to farming and rural communities, not migrant workers slaving away on the harvests.
However, the income crisis for the majority of farmers is real. It is underpinned by decades of government policy promoting cheap imported food, while the supermarket monopolies dictate prices to farmers.
Socialists stand for the nationalisation of the great landed estates, with the land shared out among those who work it. We stand for the establishment of democratically controlled cooperatives and marketing boards to regulate quality and prices in the interests of producers and consumers.
The farm protest shows the rich will defend their wealth even against a pro-business, austerity Labour government, no matter how minor the measures. The trade union movement should encourage small farmers and tenants to break their unity with the big landlords in the National Farmers Union and ally with the TUC on mutual issues of social and climate justice.
