Shrewsbury MP: Why I abstained on inheritance tax vote for farmers
Shrewsbury’s Labour MP has explained why she abstained from the Government’s bill on controversial changes to inheritance tax last week.
Julia Buckley was one of dozens of Labour MPs who abstained on the vote to introduce the Government's plan to tax inherited farmland from April next year.
One Labour MP, Markus Campbell-Savours (Penrith and Solway), was suspended after voting against resolution 50 of the bill, which sought to introduce the new £1 million threshold for inheritance tax.
Mrs Buckley, a founding member of the Labour Rural Research Group (LRRG) caucus of 40 MPs in rural seats, said the vote came after she spent the last year lobbying on behalf of farmers and the agricultural supply chain.
The Shrewsbury MP said: “I have personally met or visited over 250 of the 347 farms in my constituency to hear first-hand about their concerns and how I can best represent them.
“Farms have many live concerns: low profitability, rising input costs, volatile weather conditions, energy costs, planning rules and sustainability grant schemes.
“But of course landowners, including farmers, are also concerned about some unintended consequences from the new proposed thresholds for inheritance tax agricultural property relief [APR].”
She said that while “those in receipt of very large inherited wealth” might be in a position to make more of a contribution to tax once a generation, “smaller farmers are also caught in the crossfire”.
She said: “With the average value of a viable farm approaching £3.5 million this means most farms could be affected and a tax bill could cause sell-offs or breaking up the farm to pay the bill.
“On this basis, along with my LRRG group I have spent the last year seeking some amendments to the bill to better protect smaller farms who are caught up unintentionally in the inheritance tax policy.”
The MP said she has spent “many hours” meeting with Treasury ministers and civil servants at Defra as well as the NFU and tax specialists.
“Ultimately the Government ministers have responded positively by offering two major concessions.
“Firstly, there will now be a transferable allowance between spouses/widows. This effectively doubles the allowance threshold to £2.65m, almost reaching the average viability price.
“Secondly, the Government has removed the APR allowance for any non-UK financial interests who purchase UK agricultural land. This is intended to close the tax loophole that was being exploited; and should protect our local farmers and their access to agricultural land.
“In the recent budget vote I, along with my rural colleagues, abstained on resolution 50 which sought to introduce the new £1m threshold for IHT [inheritance tax].”
She added: “This approach enabled us to raise our concern whilst retaining our influence within Government, in order to continue shaping this policy right up to the final vote on the finance bill on December 16.”
