Secretary of State for Wales Jo Stevens was put on the spot during a combative BBC interview in which she insisted her party was “not at war” with the nation’s farmers.
Ms Stevens was speaking on the sidelines of the Welsh Labour Conference, addressed by party leader Sir Keir Starmer today.
Farmers are angry at measures announced in Rachel Reeves’s Budget, specifically the introduction of a £1 million threshold for inheritance tax relief on agricultural and business property, a significant reduction from the previous 100% relief for all qualifying assets.
Farmers will now face a 20% tax rate on property valued above £1 million, instead of the standard 40% rate applied to other types of land and property.
The rule changes have triggered anger among farmers who descended en masse to the venue today.
Ms Stevens insisted: “Labour is certainly not at war with farmers. In the budget, we announced £5billion for agriculture to boost food security and restore nature and the budget also protected the Welsh Government’s farming budget against a really difficult economic inheritance that we received after the election from the former Conservative government.”
It was pointed out that quite apart from the concerns over inheritance tax, which many claim will prevent some families from being in a position to pass that on, farmers were also worried about feed costs and subsidies.
Ms Stevens said: “Let’s deal with the facts here. If you are a farming couple, you can leave your estate to your children, and the estate can be up to £3million pounds in value before you start paying a single penny of inheritance tax because of all the reliefs that would be available to you once you do start paying inheritance ta.
“On a value anything over £3 million pounds, you’re paying it at 20% which is half the rate that non farming estates pay, because the normal rate is 40%.
“And additionally, you have 10 years in which to pay your inheritance tax bill. And what we do know is that around 500 farms across the UK each year will be affected by this budget change. And here in Wales, we expect the proportion of that 500 to be very small indeed, because of the nature of farming in Wales, where there are lots of small farms and farm holdings.
“So very few are going to reach that £3million, which is the point at which that farming couple who want to pass their farm down through the generations will start to pay any tax at all.”
Gareth Wyn Jones, a Welsh farmer and YouTuber, who is protesting outside the Welsh Labour conference in North Wales, earlier said the Government was “destroying” an industry that was already struggling.
He also disputed the Government’s estimation that only 500 farming estates in the UK will be affected by the inheritance tax changes, saying: “Look, a lot of farmers in this country are in their 70s and 80s, they haven’t handed their farms down because that’s the way it’s always been, they’ve always known there was never going to be inheritance tax.”
