Family farms breathe a sigh of relief as the government backtracks on a controversial tax plan, but is it enough? The UK government has significantly softened its stance on taxing inherited farmland, raising the threshold from £1 million to £2.5 million. This reversal comes after months of fierce opposition from farmers and growing unease among some Labour MPs representing rural constituencies.
Last year, during the Budget announcement, ministers had proposed a 20% tax on inherited agricultural assets exceeding £1 million, set to take effect in April 2026. However, the plan faced immediate backlash, with farmers arguing it would cripple family-run operations. Environment Secretary Emma Reynolds acknowledged the concerns, stating, “We’ve listened to farmers nationwide and are adjusting the policy to safeguard more family farms. Larger estates should contribute fairly, while we support the smaller farms and businesses that are vital to rural Britain.”
But here’s where it gets controversial: While the threshold increase is a step in the right direction, critics argue it doesn’t go far enough. Tom Bradshaw, head of the National Farmers' Union, praised the change, saying it “shields many family farms from a devastating blow.” Yet, Gavin Lane, President of the Country Land and Business Association, pointed out that the revised policy still leaves many vulnerable. “This announcement reduces the harm but doesn’t eliminate it,” he said. “Numerous family businesses own valuable machinery and land that push them above the threshold, yet their slim profit margins make this tax unaffordable.”
The past 14 months have seen farmers repeatedly protesting outside Parliament, with some Labour MPs in rural areas voicing their dissent. During a recent parliamentary vote, a dozen backbenchers abstained, and Markus Campbell-Savours voted against the plan, leading to his suspension from the party. He now sits as an independent MP.
And this is the part most people miss: The debate isn’t just about farmland—it’s about the broader impact on family businesses. Conservative leader Kemi Badenoch vowed to continue the fight, stating, “This isn’t over. Other family businesses are still burdened by Labour’s tax hike, and we won’t stop until they’re relieved too.” Meanwhile, Liberal Democrat spokesperson Tim Farron condemned the government’s handling of the issue, calling it “utterly inexcusable” to subject family farmers to over a year of uncertainty. He promised that if the government doesn’t scrap the tax entirely, the Liberal Democrats will propose amendments in the new year.
Is this tax fair, or does it unfairly target the backbone of rural Britain? The revised policy has eased some concerns, but the debate rages on. What do you think? Should the government go further to protect family farms, or is this a necessary measure for fiscal responsibility? Let us know in the comments below—your voice matters in this ongoing conversation.
