Government Partially Reverses 20% Inheritance Tax for Farms
The government has partially reversed a 20% inheritance tax applied to farms, with approximately half of the affected farms set to be exempt from this tax starting next April. This shift in policy comes after protests and diplomatic efforts by the National Farmers' Union (NFU), which helped move government aims from full removal of the tax to mitigation measures.
Rural and semi-rural Labour Members of Parliament also pressed for concessions, with more than 30 of them abstaining on the policy vote. The timing and rationale for the reversal remain speculative; while ministers held more positive talks this month, they were not pre-warned of the announcement.
Keir Starmer's appearance before the liaison committee may have influenced the dynamics surrounding the decision. Downing Street plans to publicize the change in January to reduce negative headlines and minimize political damage.
Critics argue that the reversal was executed during a parliamentary recess to avoid scrutiny. The cost of the reversal is estimated at £130 million, which is small relative to the UK's annual tax intake of about £900 billion. It is also noted that while the NFU organized mass parliamentary lobbying, it did not coordinate the noisy tractor protests.
