News, Politics

‘Like the final twist of the knife’: Nottinghamshire farmers say tax changes could destroy vital rural industries

Nottinghamshire farmers say planned Government changes to taxes will be like the ‘final twist of the knife’ for the industry.

Richard Barlow and his son James, who run their family farm at Cropwell Bishop, Rushcliffe, say they and other protesters “are not going to back down” from opposition to Government plans first announced in the November 2024 Budget.

Four generations of the Barlow family have previously owned and worked on the arable farm – one that grows crops including wheat, barley, and oats.

James, now 31, has been working on the farm since he was a teenager. He was expected to take over from Richard, 62, and had hoped to become the fifth generation of the family to have been in charge of the land.

He says this is now unlikely to happen because of rises in inheritance tax announced by Chancellor Rachel Reeves in the November announcement. The tax is paid when people inherit land or money of a significant amount from someone who has passed away.

Most farmers currently pay little to no inheritance tax because of special rules made by previous Governments, which argued British family farms were important in feeding the country and therefore should be exempt from paying to ensure younger generations have good incentives to stay in the industry.

This meant family farms could essentially be handed down from generation to generation tax-free, across decades – helping to underpin security in food supply and land management. But under the new rules, which will come into effect next April, farms with more than £1 million worth of land will have to pay 20 per cent inheritance tax for the first time.

The government says the changes will only affect the wealthiest 500 farms nationally each year. However, unions disagree and say up to 70,000 farms could be affected overall.

Farmers across the country have staged a series of protests against the Government, arguing the move is unfair and will make already costly food prices even more expensive.

Several high-profile events have been held in London, which have seen hundreds of tractors block the roads surrounding Downing Street and the Houses of Parliament.

James and Richard joined other farmers and supporters in the most recent protest in London on Monday (February 10).

“Until the government can come to the table and consult with us on a more sustainable way to gain taxable revenue from agriculture, we will keep going,” James said.

“The problem with the arable industry is that it’s just not profitable. That’s why this proposed change is really so cruel, because we haven’t got the profitability in our business to enable us to pay the tax, which then stops us from being able to reinvest into the farm.

“The whole thing can become quite misconstrued – it’s not about farmers not wanting to pay tax. We pay as much tax on our profits as any other business up and down the country – and so we should.

“But the inheritance tax exemptions were initially there to safeguard our food production. The industry is on its knees as it is and this is like the final twist of the knife”.

James – who currently doesn’t earn any money from the farm and has a separate full-time job – says the tax will create extra costs for the family which they will be unlikely to manage to pay.

He adds that since starting work on the farm more than ten years ago, profits have gone down, but the work has got harder. A trend across the British agricultural community, he says this has led to an increased reliance on food imports from other countries.

“The difficulty with that is that imports from other countries are often produced at a substandard level of what we have to legally produce in the UK,” he continued.

“Other countries use chemicals and farming practices that have been banned here for a long time – and yet we’re still importing all of those.

“When I was young, this same farm was giving three families a relatively comfortable level of income each. Nowadays, my father and mother with two grown-up children who have gone and supported themselves, are earning a modest income.

“Farming is broken and we need to work with government to come up with a sustainable way to improve the profitability of farming so we can pay our fair share back into the treasury.”

Richard, who has been working on the farm since he left school at 16, says the inheritance tax is becoming the ‘final straw’ for a lot of people in the agricultural industry.

“A lot of farmers are feeling quite battered down at the moment and things don’t seem to be easy anymore,” he said.

“I look back now and think about the amount of money I’ve spent trying to build the farm. It’s been at the expense of holidays, taking the boys out – they’ve probably missed out on a lot because we’ve always been paying off and buying land.

“This inheritance tax is becoming the final straw, because people are going to be asking if there is any point if you can’t hand it down to the next generation. There’s just not going to be a full-time living out of it for the next generation.”

Notts TV has contacted the Treasury for comment.

In a joint statement issued when the changes were announced in November, Chancellor Rachel Reeves and Food and Rural Affairs Secretary Steve Reed said: “Farmers are the backbone of Britain, and we recognise the strength of feeling expressed by farming and rural communities in recent weeks. We are steadfast in our commitment to Britain’s farming industry because food security is national security.

“It’s why we are investing £5 billion into farming over the next two years – the largest amount ever directed towards sustainable food production, rural economic growth and nature’s recovery in our country’s history.

“But with public services crumbling and a £22 billion fiscal hole that this Government inherited, we have taken difficult decisions.

“The reforms to Agricultural Property Relief ensure that wealthier estates and the most valuable farms pay their fair share to invest in our schools and health services that farmers and families in rural communities rely on.”