A farmer and leading campaigner exposed the futility of Reeves’ tax raid in a heated clash with a Labour MP yesterday as tractors gridlocked Whitehall for the second time.
Cornish farmer Victoria Vyvyan, who is also President of the Country Land and Business Association, was responding to a question from Andrew Pakes, Labour MP for Peterborough, in a Defra select committee meeting yesterday.
Pakes asked Vyvyan on whether she had come up with alternative plans for how to increase funding for public services if not through changes to inheritance tax.
He said: “If the Government was here, they would say all sectors need to contribute and they’re trying to do it fairly.
“They would say all sectors need to contribute because they're trying to repair public services.
“Have you done any modelling, have you got any data you could share with us about what changes need to happen in those public services in rural areas, and any alternative funding you'd put into those?”
Andrew Pakes speaking at the Defra committee meeting
Parliament TV
Vyvyan replied: “Well, that's a big question. We have produced a paper with a with the All-Party parliamentary Group a couple of years ago about the rural economy and about how to reinforce and grow the rural economy.”
The farming champion then took issue with what she perceived to be the Labour MPs’ insinuation farmers weren’t contributing to Britain.
“I take it a little bit amiss. We do pay our taxes. We are talking about capital taxes here, not the fact that we're paying our income tax.
“We're paying our VAT, we're paying our staff, we're paying their national insurance contributions. We are contributing.
“This is not a sector that’s not contributing. And by the way, we’re trundling out a whole fat load of food at the same time, which we are forced to sell at less than market price.
“So, you know, it's not like we're not contributing. I think that's crept into the dialogue, which I sometimes feel it shouldn't have.
“What we could contribute [through inheritance tax] is not very much money. I think it's worth a day and a quarter of the NHS spending.
“Is the candle worth the flame? Is it worth ruining an entire industry for one and a quarter days of the NHS?
“I think Mr Streeting might suggest that he'd like some more help with changing the NHS.”
NHS spending | The 'blackhole' | Amount raised by farm tax raid
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At that point, Pakes interjected, stating: “My question is, have you identified other routes that would raise money to put into public services in rural areas if it wasn't this?”
Vyvyan replied: “Yes. It's a long document and I'd be more than happy to send it to you.
“But the best way to improve this sector is to grow. Help us to invest, help us to grow our businesses and we will have the capacity because we lag behind the urban areas in terms of productivity.
“We have the capacity to add £40billion to the GVA of this country. And funnily enough that was the sum she [Chancellor Reeves] was looking for.
“So don't kill us. Let us fight our way out of this corner.”
The Treasury aims to raise £520million a year by 2030 from Reeves’ inheritance tax raid.
This equates to one day and five hours of NHS spending. It is 50 times smaller than the amount the Treasury will raise from raising Employers’ NI contributions and makes up 2.3 per cent of the ‘£22billion black hole’.
Earlier in Defra’s select committee meeting, National Farming Union President Tom Bradshaw broke down in tears answering a question on the impacts of Reeves’ tax raid on farmers' mental health.
He warned elderly farmers might decide they "don’t want to be here" before the tax kicks in.
The farm champion highlighted how all tax advice for the past thirty years has been to keep hold of your farm until death.
But with Reeves’ announcement, for which there was zero warning or consultation, farmers now must use the seven-year gifting rule to reduce their death duties.
Obviously, the rule means the farmer must live for seven more years, which is what troubled Bradshaw as he believes elderly farmers or ones in ill health may end their lives to beat the tax.
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PICTURED: Tractors line Whitehall as protests continueREUTERSMr Bradshaw said: “Until the Chancellor announced her budget, the correct advice was to keep your they keep the farm until death.
“Now they don't have any way to plan through that. And yet they've given everything to producing the food for this country in that period, post-Second World War.
“They really deserve a lot more respect than they have been given by the changes that are proposed.
“And I am going to talk about the most severe human impacts, which we believe could end up being triggered by this.
“Those people who genuinely are either in ill health or don't believe that they are going to be able to live for seven years, may well decide that they shouldn't be here on April 26th.
“No policy should ever be published that has that as an unintended side effect.”
Labour says their commitment to farmers remains steadfast and point to their record investment in sustainable food production.
Ministers have stated they are taking the tough decisions now to fill the £22billion black hole.
Andrew Pakes became an MP in July 2024 when he won the semi-rural seat of Peterborough by 118 votes. He has been approached for comment.
