Keir Starmer challenged by senior Labour MP over farm tax plan

Sir Keir Starmer has been challenged by a senior Labour MP over claims farmers were contemplating suicide to avoid the Government’s inheritance tax changes.

Appearing before the Liaison Committee, the Prime Minister insisted he understood the concerns of rural communities over the changes to agricultural property relief which come into effect in April.

But Labour’s Cat Smith, who chairs the Commons Procedure Committee, said some farmers with a terminal illness were “actively planning to expedite their own deaths” before the inheritance tax break is removed.

At the Liaison Committee, a panel of senior parliamentarians who chair the various Commons committees, Lancaster and Wyre MP Ms Smith said rural communities “put their trust in Labour for the very first time in a very long time and gave us a mandate for change in this country” in the 2024 landslide election win.

But she said farmers felt “misled” by the changes to inheritance tax and agricultural property relief announced in Rachel Reeves’s first Budget.

She said “elderly farmers, or farmers with a terminal diagnosis, are in a position whereby if they die before April, their farm will pass to the next generation with no tax implications” but if they survive until after that date they face the family farm becoming “completely unviable” for their descendants.

The MP asked Sir Keir: “Can you see how farmers can feel that this Government hasn’t necessarily treated them the way that they expect to be treated as working people?”

The Prime Minister told her: “I do understand the concern, and I met with the president of the NFU (National Farmers’ Union) just last week, as I’ve met with him before, to run through the particular concerns they have.

“I do think on agricultural property relief, there had to be sensible reform. And I think this is sensible reform.”

The change is expected to bring in around £500 million a year for the Exchequer.

Ms Smith asked if Sir Keir was “aware that some farmers who have a terminal diagnosis now are actively planning to expedite their own deaths” before April.

Discussions

Sir Keir told her: “I’ve had discussions with a number of individuals who have drawn all manner of things to my attention.”

Environment, Food and Rural Affairs Committee chairman Alistair Carmichael said: “Nobody should be left feeling – as Cat Smith has just described – that they would be better off dying between now and next April.”

Sir Keir told him: “No, of course. But governments have to bring about sensible reform.”

Mr Carmichael, a Liberal Democrat, asked Sir Keir why he was not willing to ditch the policy in the face of criticism, including from Labour-dominated parliamentary committees.

The Lib Dem said: “You don’t have to listen to me. You don’t even have to listen to the farmers out there. You don’t have to listen to the president of the NFU.

“But why do you not listen to your own party colleagues?”

Sir Keir told him: “I do listen to party colleagues all the time.”