A MONTH ago I wrote about my concerns that the government may be planning damaging tax rises which could hurt our family farms.
Unfortunately, these have now been realised and the Chancellor announced that agricultural land will now be subject to inheritance tax from 2026, making it much harder for some farmers to pass on their farms to the next generation.
It suggests to me that the ministers making these decisions have no knowledge or understanding of how things work in rural communities like ours and the importance of our farms for food production and conservation.
The exemption which was in place for agricultural land ensured that farms did not need to be sold off or broken up to pay large tax bills.
Now the land will be treated like financial assets, even though in many cases the notional market value of that land is meaningless because the beneficiaries have no intention of selling it.
Removing the exemption will make it much harder for some farming families to continue the family business.
This is a straightforward tax grab by people who seem to view farmers as rich landowners when many have to struggle just to keep things going and face constant uncertainties from volatile markets and unpredictable climate.
Sadly it is a similar tale when it comes to the massive increase in National Insurance for employers.
There is hardly any experience of the world of business within the new Cabinet, and it shows.
The official independent forecasting body, the Office for Budget Responsibility, has said that more than three-quarters of the impact of the tax rise will feed through into lower wages for workers.
This despite the fact the government had been adamant it would keep to its manifesto commitment to not raise taxes on working people, including National Insurance.
The way the government has chosen to implement the change, by lowering the threshold for the tax as well as increasing the rate, means it also disproportionately affects lower paid work.
It will mean in the tourism and hospitality industry, for example – a vital part of the Devon economy – there is a significant increase in the cost of employing people, meaning fewer jobs and lower wages.
I ran my own business before I became a Member of Parliament and I know how challenging it can be when taxes and other burdens are piled on top of each other.
This is a tax on jobs and it will make life harder for many small businesses in our community, as well as meaning fewer job opportunities for our young people.
None of this bodes well for the coming years. The government said it wanted to unleash economic growth but the only growth predicted from their budget measures comes from the short-term stimulus of higher government spending – a sugar rush which falls away.
For real growth we need the government to understand how business and the real economy actually works, and sadly so far they are showing very little of that.