‘Labour’s farming U-turn is a smokescreen and I won’t stop fighting’ | UK | News

A 40-year-old farmer from Northamptonshire says Labor abandoning plans to impose an inheritance tax on farms worth more than £1 million will only protect him “in the short term” and betrays a lack of understanding of the fundamental issues damaging the sector. The watered-down policy will see the 100% discount threshold on qualifying agricultural assets rise to £2.5 million in April; By combining their allowances, couples will be able to transfer assets worth £5 million without inheritance tax.

Above the allowance, farmers will receive a 50% asset reduction and pay a reduced rate of up to 20% instead of the standard 40%. According to the government, the number of inherited farms will also decrease from approximately 2,000 to around 1,100. Philip Weston, whose family has owned Hartwell Park Farm in Northamptonshire since 1820, said the change would initially “help him a lot” but would ultimately only delay the financial hit by a few years, with rising land value and diversification costs “inevitably pushing us and others back into the danger zone”.

Mr. Weston’s father died three years ago and he is now in a business partnership with his mother. He spent “millions” getting legal advice on the inheritance after her death and was told he would be handed a tax bill of £200,000, with £20,000 payable a year for ten years.

“Any concession is better than nothing, but inheritance tax will still impact many family farms, especially in the long term,” he told the Express. “It is being celebrated as a victory for farmers, but costs continue to rise and as a result more people are changing jobs or adding jobs to their land, which will increase asset value as well as inflation.

Land value has outpaced farm profits for years, due to a lack of regulation of supply for supermarkets and a reliance on calculations based on general market value rather than productive use.

Mr Weston is among farmers calling for the complete scrapping of the inheritance tax levy, introduced to raise money for public services after years of exemption, warning it could deal an existential blow to businesses that support Britain’s food security. The Daily Express’ Save Britain’s Family Farms campaign also demanded that Chancellor Rachel Reeves back down on the tax raid announced in last year’s budget.

He said Labour’s U-turn on its previous dogged commitment to controversial plans signaled only a “partial” reversal, as well as an indication that the government could not be trusted to introduce strong and lasting protections for an industry already under pressure.

“This U-turn proves right everyone who thought he was lying about its impact from the beginning,” he added. “It also shows a complete lack of commitment. They said they weren’t going to get rid of it or change it, and now they have. We have no idea what they’re going to do next.

“Farming is certainly a business that relies on long-term planning, but everything Keir Starmer does seems reactionary, not based on real analysis and understanding.”

Mr Weston continued: “The industry is at a critical point. “Payments for products are appallingly low and growth costs are appallingly high. This announcement is a smokescreen that gives the impression that the government is actively trying to help us but actually isn’t. That’s why we have to keep fighting.”

The 40-year-old has two children who became his role models and became “the reason for everything I do on the farm” after their father passed away, and he hoped to keep that in the family and preserve skills that have been passed down from generation to generation for hundreds of years.

“When the inheritance tax change was announced, it seemed like everything I had done was for nothing,” he said. “So what motivates me to go out now and do all this work and work hard for better efficiency? I would make more money by selling all my equipment and renting my sheds for storage.

“But if you do that, you’ll never be able to go back to farming. Investing in machinery alone will be absolutely impossible. When family farms disappear, they disappear, too. And if I can’t run a farm that’s been here since 1820, how is anyone thinking of going into the business now going to do that?”

Fear of losing inheritance tax relief, along with wider economic factors, has led to a rise in farm closures in the UK until June 2025; a record 6,365 agricultural, forestry and fishing businesses ceased trading; this was the highest number since records began in 2017.

Labor’s concession follows the publication of a long-awaited review into farm profitability, which proposes a “new deal” for the sector to recognize the true costs of food production and distribution to the environment.

Baroness Minette Batters, former president of the National Farmers Union (NFU), said the introduction of an inheritance tax on farms was the biggest issue raised by participants regarding the sustainability of farming.

Uncertainty over the Sustainable Farming Incentive (SFI), which forms the main part of the environmental land management plan for post-Brexit agricultural payments and has been suspended since March, was also an ongoing concern.

NFU President Tom Bradshaw said the policy change would be a “huge relief for many people” and would “significantly” reduce the tax burden on some family farms. “I’m thankful that common sense prevailed and the government listened to us,” he said.

But Clive Pinton, head of wills, trusts and tax at Aaron and Partners, warned this should not be seen as an “all clear” for the sector. “This is welcome news for farmers across the country who would otherwise face a significant and sudden inheritance tax burden, and the increased £2.5 million threshold will provide some protection for smaller farming businesses,” he said.

“However, this should not be taken as a completely obvious situation. Most farmland will still fall under the changes, often without owners realizing it. Land and property values ​​have risen sharply in recent years, meaning assets could cross the new threshold much more easily than expected.

“It is therefore vital that farmers seek expert legal advice early and undertake a full review of their assets and property structure. Without a proper audit, there is a real risk that families will be faced with an unexpected tax liability at an already difficult time. It is crucial to plan now to avoid unpleasant surprises later.”

Conservative leader Kemi Badenoch also claimed “the fight is not over” following Tuesday’s announcement, and the Liberal Democrats’ environment, food and rural affairs spokesman Tim Farron called on Labor to “remove the unfair tax altogether”, noting that “many family farms still find themselves financially crippled and barely earning the minimum wage”.

Environment Secretary Emma Reynolds said: “Farmers are at the heart of our food security and environmental management and I am determined to work with them to ensure a profitable future for British farming.

“We’ve listened closely to farmers across the country and are making changes to protect more ordinary family farms. It’s right that larger estates contribute more, while supporting the farms and commercial businesses that form the backbone of Britain’s rural communities.”