Liberal Democrat leader Sir Ed Davey said the government needed to “listen to rural communities” and reverse the change, claiming it would impact around 70,000 farms.
That figure comes from the Country Land and Business Association. Its president, Victoria Vyvyan said, external: “We estimate that capping agricultural property relief at £1m could harm 70,000 UK farms, damaging family businesses and destabilising food security.”
That’s not a figure for the number of estates that will have to pay inheritance tax each year, it’s an estimate of the total number of farms worth enough to pay.
There are a couple of ways to get to that.
Yiorgos Gadanakis, associate professor of agricultural business management at University of Reading, Whiteknights pointed to various sources including Defra’s Farm Business Survey, which suggest that between about 30 and 35% of farms in the UK could be valued at over £1m.
As there are about 209,000 farm holdings in the UK, that gives an estimate of between 62,700 and 73,150.
An alternative way is to look at the number of farms that are bigger than about 200 hectares, because at average land prices that would be enough to mean inheritance tax was due. That figure comes out at about 70,000.
Sally Shortall, professor of rural economy at Newcastle University, points out they will not be evenly distributed across the country because of differing land values. “Farms in England are likely to be the hardest hit,” she said.
But of course a farm will only be affected once it is inherited, so 70,000 is not necessarily the right number to use.