Lizzi Collinge

As someone who represents a large semi-rural constituency, I am glad to have this opportunity to speak about the changes to agricultural and business property relief and why they matter for farming families and for fairness in our tax system. I welcome these changes, which recognise the reality of the asset-rich, but cash-poor nature of farming, where land might be worth a lot of money by most people’s standards, but that value cannot be realised in cash terms unless it is sold, particularly for non-farming use. The aim of this inheritance tax policy is simple: fairness for hard-working family farms, but no open-ended tax breaks for the wealthiest. The Government are reforming outdated tax relief rules to ensure that the very largest estates make a fair contribution. Under these changes, small and medium-sized agricultural estates will remain unaffected by inheritance tax, with full relief still applying up to £2.5 million for an individual, rising to £5 million for a married couple, who will be able to transfer their allowances to each other, as is the case for personal inheritance tax. I am slightly surprised that those on the Conservative Benches are only now discovering that concept, given that it has been standard for many years. What will change is the ability for the ultra-wealthy and the very largest estates to use agricultural land as a tax planning tool, driving up land prices and shutting out genuine farmers, while making little or no contribution in return. The farmers I have spent time with—over many meetings in village halls, at farmhouses and at the Westmorland county show, which I highly recommend—were clear that they understood the need to prevent the ultra-wealthy avoiding tax, but they were rightly concerned that the threshold of £1 million, as originally proposed, would inadvertently catch ordinary family farms. Local farmers and solicitors were extremely generous in sharing their financial information with me, which was sent directly to the Treasury. It showed the reality of the finances of farming. I must make special mention of a local Labour party member, Karenna Caun, who organised for that information to be gathered and who helped me to reach out to farmers and related businesses, particularly in the Lune valley. The NFU and others have already recognised that these changes materially improved the position for farming families. These changes have taken on board concerns raised by rural Labour MPs, but with these reforms targeted at the biggest estates, the Government expect to raise £300 million a year by the end of the decade. That is money we can put into local GP services, rural bus services and village schools, giving our children the best start in life. Yes, some of the largest estates will pay more after these changes.