Why are a tiny number of rich farmers dominating the news cycle?

[InvisibleRadiator]

I've been reading around this inheritance tax issue, and the more I read the more I agree with government policy!

For starters the government thinks this will only affect the 500 richest farms and some think this could be as low as 100 farms!
x.com/DanNeidle/status/1852064433738256394

How on earth have such a rich elite managed to whip everyone up into such a frenzy, making it sound like poor old farmer Giles's kids are going to have to sell the family farm when he dies.
The following article explains how when taking into account the IHT property exemption, a married farming couple would not pay IHT unless their assets exceeded £3 million!
www.independent.co.uk/news/business/inheritance-tax-farmers-protest-maths-b2649181.html

And there are so many concessions such as having 10 years to pay, and being half the rate most others pay! And there are many ways to legally reduce the impact of the tax.

It's clear that wealthy investors have been pushing up land prices, and apparently farmers are involved in less than half the land sales now, when compared to 15 years ago.

And now this tiny band of super rich are trying to plead poverty? I don't believe a word of it.

This final article puts it far more eloquently than I ever could.
www.theguardian.com/commentisfree/2024/nov/17/farmers-have-hoarded-land-for-too-long-inheritance-tax-will-bring-new-life-to-rural-britain

Good on Labour for standing up for the average person and trying to claw back a tiny portion of generations of inherited wealth for our public services!

Farmers work with big numbers but are not necessarily cash rich. Their land may be worth millions, but it's not as if they will ever 'cash in' on that value. They have to spend thousands to run a farmer and hope the sesson goes to plan or could lose thousands. A lot can go wrong.

In terms of the bigger impact of this, my immediate thought was that they would have to sell up and then surely these farms would land in the hands of overseas conglomerates. In my mind, this spells the end of traditional farming. What a disaster. We will be eating substandard food for sure being produced by who exactly?

Some older farmers literally feel they are better off dead now so that the land passes quickly to their family. How sad.

I don't have any loyalty to any political party.

It doesn't work like that though does it? Agricultural land can't just get a change of use at the drop of a hat so that houses can be built. But in a lot of areas we need more housing anyway, rather than land farmers get paid not to grow things on.

There is currently no IHT on farmland. Hasn’t been for 30 years so not sure that this was a ‘farm’ .

@AMFA thanks. Really informative post.

Anyone else subject to IHT is not necessarily cash rich either, if they just inherited an average sized house in the south east. Yet IHT still has to be paid.

Whatever legislation there is 'to protect the best farmland' doesn't seem to work around here, where acres of highly productive arable are currently being covered in housing developments (while vast former industrial brownfield site a few miles away lies desolate...)

I know quite a few farmers. You need about 200 acres around here to have a decently viable farm. The land alone is worth £2mill, before you get to the value of the machinery (tractor plus various bolt-ons like telehandler, plough, seed drill, combine, sprayer, trailer, baler....)

There has to be some way of getting the IHT off the very rich without buggering up the family farm. Because if the land goes to big corporates with a mono-focus on this year's bottom line, expect to see it utterly trashed.

Yes but a house you inherit isn’t your livelihood. Farms are working businesses. The land is actually worthless in practise while the farm is in operation as the farm would disappear if the land was sold to realise its value.

I thought the whole point of the IHT argument and farming is that the majority of farms are run by generations - the grandfather leaves to father leaves to son/daughter etc so that farms stay in families.

It's not like when someone else's parent dies and leaves a big old house that the children aren't going to live in and so they sell it and bank the money to enrich their own lives/lifestyles.

Subjecting farms to IHT means that they are unlikely to stay within and be operated by the family as they will have to sell it to pay the tax. When actually what the family want to do is run it and operate like they will have done for generations past

Farms and IHT for everyone else are just not comparable

Exactly. My friends mum scraped by on a very low income for decades to keep her house (now worth about £3m) after her husband died. Now she tries to heat it and maintain it on the state pension alone. Should my friend be exempt from IHT on this house because her mum overstretched to stay in it?

This is said an awful lot, but what is never acknowledged is that a £3m farm on paper does not translate to a wealthy farmer.

There is definitely a need to drive down the price of land, but IHT is a dangerous way to do it. Long term it may do the trick, but it’s sacrificing farms and food security to carry it out.

Yes if a family home was inherited it may well need to be sold to pay IHT, but you’re not losing a generational business that provides food for the nation, run by incredibly hard workers who know not to expect great returns for their hard work. I don’t agree with IHT at all, but potentially losing your parents home to it is not comparable to losing a working farm.

I’m not entirely sure why farmers will have to sell the land to pay IHT. It’s only 20% and they can pay that in instalments over 10 years.

Assuming that farm and house are worth 4 millions they will have to find an additional 20,000 per annum out of income. They have just inherited a farm house and presumably were living somewhere beforehand - so that’s rent or mortgage saved.

Many farmers only turn a profit of about £40k ish a year. Where on earth could they find a spare £20k from?

Who is ‘they’? I don’t know any farmer who wants children to go hungry. I think most are very much in favour of free school meals as it is considered a positive thing for both small scale farmers and children. One of the big arguments in favour of free school meals is that they help British farmers who suffer from unpredictable demands and low prices from supermarkets.

Jeremy Clarkson isn’t your typical farmer and has nothing in common with any farmer that I have met. He is a talk show host. It isn’t fair to form an opinion about farmers because of your views on him.

Again, everyone seems to care about landowner farmers while conveniently ignoring the fact that lots of farmers are tenant farmers.

The concept might be okay in principle but the execution of it is truly abhorrent; do you really not understand or does the chip on your shoulder stop your brain from doing the maths? Even DEFRA’s figures differ from the Chancellor’s and as you’d expect so do the NFU’s. This change was supposed to stop the very wealthy from banking land as a way of avoiding inheritance tax. Instead there will be many genuine farming families pulled into these payments which will decimate farms. Do the simple maths: acreage X current value plus machinery plus house(s) plus standing crops/livestock=a lot of value in your assets. Compare this to annual income and you can see that many farmers farm because it’s what their family has always done not as a get rich quick scheme. They farm and we have food. They farm and the countryside is (generally) richly biodiverse. They farm and have isolated lives that require jobs off the farm for the family to survive. Very few live like Jeremy Clarkson. He is to farming what Jamie Oliver was to school dinners. Did you disagree with that too? Look up how much it costs to purchase a combine harvester or a tractor of a dairy heifer and do the maths by comparing that to the annual returns.

Sorry, one more thing; do you really think it will be spent on public services? That’s a whole other thread sorting them out. They could learn a lot from farmers.

Christ please don’t put Jamie Oliver who created employment schemes for young unemployed adults and who successfully lobbied the government on raising the standard of school meals for kids all over the country, in the same bracket as that self serving gobshite Jeremy Clarkson.

But dividing large farms into lots of small hobby small holdings is still going to decrease food production. Look at the state of so many people’s allotments - people can’t manage 4sq meters of land…

That’s terribly unfair. I actually spoke to a random group of farmers yesterday on my way home and they actually think JC has been brilliant in highlighting the issues they face. They said the show is clearly staged for the programme but the issues are real. In fact, it shows how immensely hard it is for a person who did not grow up in a farming community and being immersed in it to become a farmer. He’s only managing because he has money to subsidise his mistakes. The fact that JC is highlighting just how hard it is to be a farmer is helping them. Why he bought the land in the first place is irrelevant.

No, tenant farmers will still be affected by this, and may still be shafted as landlords could end up selling off land as well. Many tenant farmers have lived and run their farms for generations as well.

I was listening to the BBC the return on farming is 1% either food rises or land becomes cheaper, neither is likely in this life.

Because we have a shallow mainstream media outlets who prefer to interview a famous person like Clarkson rather than actually bother to report on the issue itself.

Totally agree op
Might lead to the end of the practice of leaving everything yo the eldest son
Splitting up farms is not issue in terms of production, assets like machinery can be shared or hired (as they often are currently anyway)
The protests? just the usual rich men getting poor men & women to do their dirty work for them (Brexit) brainwashed turkeys voting for Christmas

Obviously I am well aware of that and know we won’t ever be. However doing things that will make the situation worse does not seem sensible against that back drop ok increasing instability in parts of the world.