Welsh Farmers Criticize Inheritance Tax Reforms in Budget Announcement
Farmers in Wales have strongly condemned the recent reforms announced in the Budget, labelling them as “misguided and ill-thought-out.” The NFU Cymru has expressed concerns over the changes made to Agricultural Property Relief (APR) and Business Property Relief (BPR), stating that these alterations could have severe consequences, leading to the potential break-up of family farms across Wales.
Chancellor Rachel Reeves unveiled the reform on inheritance taxes applied to farms during the Budget announcement, declaring that starting from April 2026, the first £1 million of combined business and agricultural assets would remain exempt from inheritance tax. However, for assets exceeding £1 million, inheritance tax would be levied with a 50% relief, amounting to an effective rate of 20%.
NFU Cymru president Aled Jones voiced apprehension, stating, “The changes announced are not only a threat to our family farm structure and our tenanted sector but also to our nation’s food security.” The union believes that the modifications could result in less land being available for tenancies and contracts, which are crucial for small family farm businesses and first-time farmers.
The agricultural community has been vocal in its opposition to the Budget reforms. Well-known figures like Jeremy Clarkson and food critic Jay Rayner have also expressed dismay over the changes. Clarkson emphasised the struggles farmers have faced post-Brexit, while Rayner asserted that the reforms could have detrimental effects on long-standing farming families.
The Farmers’ Union of Wales president, Ian Rickman, echoed similar sentiments, highlighting the potential impact of the alterations to agricultural property relief on the viability of family farms and rural communities. He emphasised the integral role of Agricultural Property Relief in ensuring the smooth transfer of family farms between generations without imposing heavy tax burdens.
NFU President Tom Bradshaw raised concerns about the wider implications of the Budget, stating, “This budget not only threatens family farms but also makes producing food more expensive.” Bradshaw warned that the increased costs could jeopardize the resilience of food production and hinder future sustainability in the agricultural sector.
In response to the Budget reforms, farmers and industry professionals have called for urgent reconsideration by the UK Government to mitigate the potentially devastating consequences on the farming community in Wales. The uncertainty generated by these changes has added further challenges to farm businesses striving to contribute to food production and environmental conservation in the region.