ALTHOUGH Chancellor of the Exchequer Alistair Darling has hurriedly re-written his plans for a reform of the capital gains tax laws, he has still left farmers and landowners angry at his new proposals.

Investments in farmland, breeding livestock and expensive new machinery tend to made on a long-term basis but the new, complex tax proposals meant to encourage rural entrepreneurship are in fact worse than existing arrangements, says the Country Land and Business Association (CLA).

And the new system will also make it more difficult to hand over their farms to sons or daughters without paying more taxes. CLA President, Henry Aubrey-Fletcher described the new tax regime as "particularly punitive when we have responded to Government calls to diversify and increase employment and job opportunities in the countryside."

And of the hand-over problems, he added: "The reality is that it can take a long time for a farmer to hand over and fully retire. Retirement relief required the clear cut disposal of a business and made no allowances for the drawn out process that practicality often demands - so this new proposal is going to do nothing to bring about the simplification the Chancellor promised."

The Chancellor's new policy comes as a disheartening blow to the CLA because it has been in long term negotiations with the Government, offering expert advice on boosting the rural economy.

Douglas Chalmers, Director CLA North, commented: "It is part of the CLA's job to point out to the legislators the effects of their proposed policies on rural businesses and communities.

"Many are eager to embrace new opportunities, and are already being stymied by a lack of planning support and a current gap in funding. An unsympathetic tax regime does nothing to encourage rural enterprise, when new jobs can secure the future of communities".