Ahead of a significant farmer protest in London today, the Government has defended its position on the newly introduced inheritance tax reforms targeting agricultural estates.
Chancellor of the Exchequer Rachel Reeves and Environment Secretary Steve Reed issued a joint statement justifying the policy, which imposes a 20% inheritance tax on farms valued over £1 million, set to take effect in April 2026.
The policy, announced in the October Budget, is designed to address fiscal pressures and promote fairness in taxation. Chancellor Reeves stated that the reforms aim to curb the practice of wealthy individuals acquiring farmland as a tax shelter, which often pushes younger farmers out of the market.
Environment Secretary Reed reassured the farming community that most family farms would remain unaffected by the changes. Under the new system, single farm owners can pass on up to £1.5 million tax-free to direct descendants, while couples can transfer up to £3 million. Reed also highlighted a £5 billion Government investment over two years to support sustainable food production as part of their broader commitment to agriculture.
Despite these reassurances, the farming community remains deeply concerned. Thousands of farmers are expected to gather in Whitehall for a rally against the changes today.
The Government has reiterated that the reforms are necessary to address the country’s economic challenges while ensuring fairness. However, the protests underline the significant tension between the agricultural sector and policymakers as both sides grapple with the implications of the tax changes.
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