Kentish family farms say government's inheritance tax rules could spell disaster for them

KentOnline / KMTV

Its been a year since the changes were controversially introduced at the last Budget, which will see farmland valued over 1 million pounds face a 20% tax from next April 2026.  Meghan Shaw reports.

Transcript

00:00We all know Kent as the Garden of England, but with 70% of the county comprising farmland,

00:06the most in the southeast, is it also the Farm of England too? This makes today a very important

00:12one for Kent's farmers, a year since a fatal blow to farmers' so-called prosperity. In November

00:182024, farmers from across the county descended on Whitehall in a mass protest against the

00:24government introducing an inheritance tax on farmland worth over a million pounds. But

00:30that was a year ago. Now, with the second Labour budget upon us, I'm at JL Baxter's, a fruit

00:36farm just south of Maystone, whose owner, Clive Baxter, is urging the government to reconsider.

00:42We're still trying to convince the government that they've made the wrong decision. I represent

00:50the NFU and the NFU, as a body, gets what the government's trying to do. And actually,

00:57in some ways, we're supportive and we're proposing a tax that gets to those people sheltering their

01:05wealth to a degree, saves small family farms and actually gives the Treasury more tax income.

01:13So it's a win-win. Set to take hold from April 2026, the 20% tax on farmland valued above one million

01:22could have grave effects on smaller and medium-sized farms. We're a generational business,

01:28fourth generation coming up. I have triplet daughters who would like to be involved in the

01:34business and future. Policy, I think, is clumsy because it's 20% above quite a low threshold.

01:44I mean, people might think a million pounds is an awful lot of money, but you soon invest that in,

01:50as I say, machinery and particularly farmland, it soon mounts up.

01:54The Minister of State, Food Security and Rural Affairs confirmed, ahead of the budget,

01:59that the farmer's inheritance will not make a U-turn. Farmers like John are concerned this might be the

02:04start of further measures that, despite being designed to raise funds and distribute wealth,

02:09hit those with already little cash to spare. A concern for us and probably quite a lot of farmers

02:16will be a potential mansion tax because very often the farmhouse, which is in the middle of the farm,

02:24is historically quite a nice house. It's not something we regard as an asset and we really,

02:30we would really struggle to pay that extra money.

02:32Megan Shaw for Kame TV in Seven Hooks.

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