Will farming tax-breaks be reviewed?
- AuthorCaroline Dowding
It has been argued that tax breaks for farmers should be reviewed. The concerns are that the tax breaks are ‘extremely wasteful’ and that the government gives the agricultural sector a disproportionate level of support. There are arguments that farmers have caused a “subsidy addiction”.
Economist Professor Helm has called for a review of the current taxation rules for farmers, and stated that in addition to the £3bn of subsidies, they also get benefits that nobody else does. This includes the exemption of business rates for farmland, and the use of red diesel which attracts a reduced rate of duty. His argument is that by reassessing the support given to farmers will put them in line with what other industries and businesses receive.
He also noted that farmland is being used for the benefit of getting around paying Inheritance Tax (IHT). This is because agricultural land, or pasture that is used to grow crops, or to rear animals intensively, can be passed on free of IHT either during your lifetime or as part of your will, providing certain conditions are met.
However, Defra has stated that these ideas are not under consideration currently, and has made it clear that they want to support farmers for many years to come.
It is important that farmers make the most of the benefits and reliefs that are available to them. This can be achieved in a number of ways, from ensuring that your partnership agreement is up to date, to making sure you have adequate wills in place, or undertaking lifetime tax planning.
Our specialist solicitors in the Agriculture & Estates team can help you with any of these issues, and more. If you have any questions, please get in touch with one of our specialist agricultural lawyers on 01206 217394 or firstname.lastname@example.org.