Welsh farmers attend inheritance tax debate in Senedd

The debate that took place on Wednesday, 5th March, was brought forward by Plaid Cymru. It called on the Welsh Government to make representations to the UK government that it reconsiders and pauses the so-called ‘family farm tax’ until such a time as it has conducted a thorough consultation and economic review of its impact on working farms.   

While decisions around inheritance tax policy are not devolved to Wales, NFU Cymru has welcomed the airing of this issue in the Senedd given agriculture’s multi-faceted benefits to the people and communities of Wales.  

READ MORE: Farmers protest in London on Pancake Day

‘Immense damage to rural economy’

NFU Cymru president Aled Jones said: “I am most grateful to Plaid Cymru for bringing forward today’s debate and articulating so clearly the industry’s concerns. I also thank the Welsh Conservatives and Welsh Liberal Democrats for their strong and impassioned contributions supporting the call for a pause, consultation and economic review of the family farm tax.    

“The chancellor’s proposals risk placing unsustainable tax liabilities on the backbone of our food system and by doing so, the UK government risks dismantling a vital sector and causing immense damage to our rural economy, communities as well as our Welsh language and culture. “ 

Mr Jones added that NFU Cymru’s independent analysis has shown that around 75% of commercial family farms will potentially be impacted by this new tax charge.  

“With the latest farm income figures showing average annual income on an upland cattle and sheep farm to be just £22,200, and £23,000 for lowland cattle and sheep farms, it is clear that tax charges perhaps running well into six figures would be completely unsustainable.  

“Family farming businesses are therefore, typically, asset-rich but cash-poor, and without the reliefs currently in place, these businesses—which are at the heart of our rural communities—will face the invidious prospect of either having to sell all or part of the farm, or to take out borrowings to meet inheritance tax charges,” he continued. 

Significant level of concern among farmers

Mr Jones, who watched the debate from the Senedd’s public gallery alongside NFU Cymru members from across Wales, said that the fact that so many farmers have journeyed to Cardiff yesterday, in the middle of the busy lambing period, reflects the significant level of concern that exists out there over these proposals.  

“It has been fantastic to see so many of our members speaking with their MSs around the debate, and I thank all those who have shared powerful messages with their elected members on this issue, as well as the media, both today and over the last few months. 

“NFU Cymru has long advocated for policy decisions to be based on sound economic evidence and to support the long-term sustainability of our farming industry, and that remains our position. It therefore remains a deep source of frustration for me that the Treasury position has been resistant to any notion of pause and review of the family farm tax, or indeed any alternative proposals put forward by the industry.  

“We see an important role for Welsh Government in helping amplify the Welsh farming industry’s calls for a pause and review of this Treasury policy, as well as consideration of our alternative proposals, and that is why we urged all MSs to back the Plaid Cymru motion today. 

“In our discussions with Welsh Government, we have also asked for a thorough examination of the impact of the inheritance tax changes on Welsh farming. We have also urged the Welsh Government to reassess the impact of its own current and future agricultural policies, and, if they go ahead, putting in the necessary adjustments and measures to mitigate the impact of the UK Government’s damaging proposals. 

“Whilst the Plaid Cymru motion was defeated, the fact that Wales’ national parliament was sufficiently concerned by these Treasury proposals to hold this debate sends out a clear and powerful message from Cardiff to London. I take this opportunity to urge UK government to think once again about the significant and lasting damage their policy proposal will do,” Mr Jones concluded. 

Read more political news.