Labour inheritance tax sparks fury amongst farmers
The UK farming sector is embroiled in a heated dispute following the Labour government’s recent announcement of changes to inheritance tax relief in the Autumn Budget. From April 2026, Agricultural Property Relief (APR) and Business Property Relief (BPR) will undergo significant reforms. Under the new rules, the first £1 million of combined agricultural and business assets will qualify for a full 100% tax relief, while assets above this threshold will only receive a 50% relief. These changes could lead to substantial tax bills for family farms, many of which are “asset-rich but cash-poor,” potentially forcing the sale of land or equipment to cover liabilities.
Farmers and industry representatives have raised alarms about the policy’s impact on the sustainability of family farms. With average farm valuations around £3 million, some families could face inheritance tax bills exceeding £400,000. The Country Land and Business Association (CLA) estimates that as many as 70,000 farms may be adversely affected. Critics also accuse the government of downplaying the effects, claiming that official figures misleadingly include hobby farms and smallholdings in calculations of unaffected properties.
The government has defended the move as necessary to ensure fairness and curb tax avoidance, targeting large-scale investors who may exploit APR. They argue that only the wealthiest estates will be significantly affected. Additionally, the policy includes an expansion of APR eligibility to land used in environmental schemes starting in 2025, which officials believe will encourage sustainable practices.
Despite these justifications, farming groups warn that the changes could harm food security and diminish the viability of traditional family farming. They describe the policy as a betrayal of rural communities already grappling with economic challenges.
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It’s worth noting that a few weeks ago, the Independent also published a piece supporting the inheritance tax, titled “Inheritance tax to rise in Budget as Reeves plans to hit well-off”
