Thoughts on the chancellor’s ‘dry tax’ policy

I must begin by making my personal view clear. I think that the officials who advised the chancellor that the inheritance tax (IHT) agricultural relief (APR) provisions were being used for tax avoidance on a grand scale were right. Inheritance tax business property relief (BPR) was also being exploited but only to a limited extent – mainly in connection with farming businesses. Where officials fell short is that they appear not to have properly understood the impact of the solution they came up with.

The challenge faced by officials whether they realised it or not lay in balancing the impact of any proposed changes with the need to ensure that farmers can still operate sustainably to maintain the agricultural industry. The APR provisions were in place for a purpose. My view is that although officials explored the right issues they went about their task the...