Sir Ed Davey says Lib Dems would target banks to spare farmers inheritance tax

The Liberal Democrats would raise taxes on banks and online gambling instead of ending an inheritance tax break for farmers, according to the party’s leader.
Sir Ed Davey used a visit to the Thames Valley to call on the government to abandon its proposed changes to agricultural property relief, as he set out his alternative revenue-raising policies.
“I absolutely agree that the Conservatives left the finances in a total mess and tough measures were needed”, Sir Ed told ITV News Meridian.
“The Liberal Democrats have put forward alternatives to the tax proposals from the Labour government. For example, we’ve said reverse the big tax cuts the Conservatives gave to the big banks. That would raise you over £4 billion a year.
“I’ve talked about doubling remote gaming duty. We’ve got a problem with gambling at the moment. Why not raise that? That would raise up to £1 billion a year.
“There are alternative ways of raising money to sort out the Conservatives’ economic mess and get investment in public services without hitting farming and small business.”
The MP for Kingston and Surbiton was speaking on a tour of Berkshire College of Agriculture, near Maidenhead – one of many former Conservative seats in the Thames Valley won by the Lib Dems in July.
Asked whether his pitch to farmers was part of an effort to enhance support in such former Tory strongholds, Sir Ed said: “We want to represent people who have been supporting us and people who we want to gain support from, and we’ll do that by listening to them and finding what their real issues are.”
In this week’s Budget, Chancellor Rachel Reeves announced that the first £1 million of combined business and agricultural assets will continue to attract no inheritance tax.
But for assets over £1 million, inheritance tax will apply with 50% relief, at an effective rate of 20%. Both the Conservatives and Lib Dems have called for a rethink of the policy, which is due to take effect from April 2026.
Writing in the Daily Telegraph, the Environment Secretary, Steve Reed, said: “The Government has announced plans to reform Agricultural Property Relief.
“Only the richest estates will be asked to pay – not small, family farms as some misleading headlines have claimed.
“Look at the detail and you’ll see that the vast majority of farmers will not be affected at all. They will be able to pass the family farm down to their children just as previous generations have always done.
“This is a fair and balanced approach that protects family farms while also fixing the public services those same families rely on.”
The Liberal Democrats now represent several rural Westminster constituencies in Berkshire and Oxfordshire.
Have you heard our podcast Talking Politics? Tom, Robert and Anushka dig into the biggest issues dominating the political agenda in every episode…