Thread by @TomABacon

So, I've just spent a bit of time looking into the debate on IHT and farming. I... got a shock. First, a note: I have a friend who runs a family farm. In his view, the whole thing is a something and nothing. 🧵

A third of all farmland in the UK is farmed by tenant farmers like my friend (and everybody he knows around here), who'll be completely unaffected by the IHT changes. /2

So who will be affected by the IHT changes? From April 2026, taxes will apply to agricultural assets over £1 million (or up to £3 million in certain circumstances). Here's an explainer. /3lordslibrary.parliament.uk/budget-2024-in…

Three things are worth noting: Firstly, any transfer of assets more than seven years before death is outside the scope of IHT. Secondly, the tax isn't a one-off sum - it's payable over a 10 year period, interest free. /4

And this third point is very significant: we have evidence the rich are deliberately investing their money in land to avoid paying IHT. Jeremy Clarkson himself admitted that was why he bought so much land in an interview with the Times back in 2021. /5

How big a problem is this? Well, almost half of all farms have less than 20 hectares of land. Incredibly, though, the average UK farm is 82 hectares - a staggeringly high sum that indicates how much land is owned by a minority. /6

To give a sense of comparison? Jeremy Clarkson purchased a whopping 400 hectares (20 times the average farm size) back in 2008. So whatever you do, don't think he's the average farmer; he really isn't. /7

Want to get a sense of how things are getting worse? According to property consultants Strutt & Parker, non-farmers were responsible for less than a third of farmland purchases in 2010... but this had risen to 56% by last year. /8

In the last year alone, 400,000 hectares of agricultural land have been taken out of use for farming, as the wealthiest purchase land. Doing so allows them to avoid IHT. /9

Traditionally, IHT hasn't been applied to farmland to avoid the breakup of family farms. Now, though, that's working against the country; the wealthy are purchasing vast tracts of land that avoids paying IHT. /10

You know what happens in that scenario? The family farms that we're talking about trying to protect... are gone. If you want to talk about food security, the reality is that things are getting worse. /11

Looking at this, there seems a strong case for IHT reform. The current situation is both unsustainable and deeply problematic, leading to an outcome we desperately want to avoid - where the wealthy own almost all the land and family farms are dying. /12

This, of course, is NOT the discussion that's happening in the media. Why not? Well, partly because a lot of famous, wealthy, and vocal people WILL be affected by the change to IHT (Jeremy Clarkson, Lloyd Webber, etc). /13

Ten landowners - just ten! - own one sixth of Dorset. They include Jonathan Harmsworth... whose family own the Daily Mail. Are alarm bells beginning to ring over the way this debate's being framed? /14

Now, I should add I do feel Labour is in trouble politically here. We have a romanticized vision of how country life works. The problem is the mental image most people have of farming... is out of date. /15

After looking into these stats, I suspect Labour made a mistake. They argued for their IHT changes simply as a result of the Tories' economic mismanagement, when in reality there's a very different case that can be made. /16

The current IHT rules have helped family farms run for a long time. Now, they have become one of several things that are killing off the farming industry. There's a very strong case for reform here imo. /17

Remember: 400,000 hectares of agricultural land were taken out of use for farming IN THE LAST YEAR. We can't allow that to continue, and so IHT reform seems like it's needed - to protect the industry. /18

I freely admit, after looking into the stats, I was left shaken. I had no idea British farming was in quite this bad shape. /end

Note: I’m more than happy to see the counter-arguments and learn! Post is going viral, so apologies as there’s no way I can see them all!

@danbarker That said, imo this made me change my views a little. At the moment, the debate seems to be defending a status quo that isn’t working anymore. The question needs to move imo, to: is this the RIGHT change? Have the government picked the wrong threshold?

@ADDZZH @10thMan2021 The list goes on. These are not sensible proposals. We do not live in a world where we can make tax cuts right now. We've already seen what 15 years of austerity have done to the country.

@Sandbach What DROVE those changes?

@Sandbach @PaulWelters (Not because of IHT. They just don't want to.)