Why farmers – not the Treasury – are right about inheritance tax

There is a reason 10,000 farmers and their supporters descended on Westminster last week to protest against the government’s planned changes to inheritance tax. They know that any farm hit by the new charge will be in huge trouble. Farms are not a typical business asset – usually the value of a farming estate is far greater than any profits it generates.

This means a single inheritance tax bill could wipe out a farm’s profits for a generation. The only solution for many farmers will be to sell up or break up their farms forever. 

Still, the government and its supporters say the inheritance tax change will only affect ‘very few’ farmers, around 500 a year maximum. Other groups, including the Country Land and Business Association, say 70,000 will be affected. How can these figures be so wildly different? And which is correct?

That huge difference seems to come from a combination of unreliable statistics, a complex tax system and a misuse – deliberate or otherwise – of the word ‘affected’ by the government.