There has been a huge surge in wealthy individuals and institutions buying up farmland across England, according to new analysis, with a parallel drop in the amount of agricultural land actively used for farming.
Farmers will descend on Westminster on Tuesday (19/11) to protest Labour’s new inheritance tax rules, which could threaten to close a well-used tax loophole for the wealthy.
Thousands of agricultural workers are expected in London, with Tom Bradshaw, the president of the National Farmers’ Union, saying he has “never seen the united sense of anger” there in the industry today.
Speaking to reporters en-route to Rio de Janeiro, the prime minister rienforced the point that the overwhelming majority of farmers would be exempt from the changes, suggesting this message may not be getting through.
“Obviously, there’s an issue around inheritance tax and I do understand the concern.
“But for a typical case, which is parents with a farm they want to pass on to one of their children, by the time you’ve taken into account not only the exemption for the farm property itself, but also the exemption for spouse to spouse, then parent to child, it’s £3 million before any inheritance tax will be payable.
“Over the £3 million, it’s then 20 per cent rather than the usual rate and it’s payable over 10 years.”
Data collected by property consultants Strutt & Parker show farmers are increasingly being squeezed out of the agricultural land market by wealthy investors.
While non-farmers were responsible for less than a third of farmland purchases in 2010, by last year this had risen to 56 per cent.
In the last year alone, 400,000 hectares (988,422 acres) of agricultural land has been taken out of use for farming.
The analysis is linking this to financial advice that recommends the potential tax breaks of investing in farmland.
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