Farmer condemns new tax rules as a 'coal miner' moment which could change face of countryside

A farmer has warned the government's controversial new inheritance tax plan for agriculture is a "coal miner" moment which could change the face of the countryside.

David Lord, 46, has been farming for more than 20 years and his family have owned their 500-acre holding near Clacton in Essex since the 1950s.

He warned the new rules, which mean farmers will have to pay tax when they pass on their land to the next generation, would lead to the break-up of family farms.

Mr Lord said the news had come as a "bolt from the blue" for farmers, who were not expecting the changes in tax which Chancellor Rachel Reeves announced in the Budget.

He said: "This is a coal miner moment for farmers, a huge, huge moment for farming. Farming in this country is built on family farms, working over the generations to farm the land."

Under plans announced in the Budget, inheritance tax will be charged at 20% on farms worth more than £1 million, although the chancellor has said in some cases the threshold could in practice be around £3 million.

Labour has defended the policy since it was announced, insisting that tough decisions needed to be taken on tax.

Mr Lord's arable farm has been in the family for three generations and doubled in size since they first took it on.

The land would be worth £7m if the Lord family wanted to sell it, but they do not.

Mr Lord said the family makes about £50,000 a year from their farming business.

He said: "Although it's worth a lot on paper the actual income we generate from farming is very little, so we don't have the cash to pay these taxes which are going to crop up when the older generation die."

He is concerned that farms will have to sell off parcels of land to pay the tax, making the farm no longer viable.

"When a family farm breaks up now because of this tax, who is going to buy this land? It's not going to be the family farmers who want to improve the land and keep it for the next generation.

"It's going to be other investors from outside the industry - the very people this government have tried to aim this policy at."

Mr Lord is also concerned about the future environmental implications of the new policy, which might mean farmers are less invested in caring for their land for future generations.

He said: "As a family we've all worked to look after the land and the environment around it and that land gets passed on through the generations so it never feels like we own the land.

"If we really wanted to sell it we could sell it and pay capital gains tax but by keeping the land we are able to have a business and farm as a family for the next generation - the farm is the asset that stays in the family.

"That's all out of the window now, they're telling us that's not what they want. I wonder what's going to be left for the younger generations."

Mr Lord said he "genuinely thought" the government had been given the wrong information and he hoped that when they looked at the facts they would have a change of heart.

His comments came as the head of the National Farmers’ Union Tom Bradshaw was meeting Environment Secretary Steve Reed amid growing anger over the chancellor’s decision.

Farming minister Daniel Zeichner, the MP for Cambridge, defended the government's new policy in the House of Commons, saying tough decisions had to be taken on tax.

He said: "Currently, small farms can find themselves facing the same levels of tax bills as much larger farms, despite having a much smaller asset.

"20% of agricultural property relief is claimed by the top 2%; 40% is claimed by the top 7%.

"That is not fair, it is not sustainable, and sadly, it has been used in some cases by wealthy landowners to avoid inheritance tax. That is why the government have announced plans to reform agricultural property relief."

Want a quick and expert briefing on the biggest news stories? Listen to our latest podcasts to find out What You Need To Know