Question to the HM Treasury:

To ask His Majesty's Government whether they will reconsider their inheritance tax reforms in order to protect the future of family farms.

The Government’s reforms to agricultural property relief and business property relief from 6 April 2026 achieve the right balance between supporting farms and fixing the public finances in a fair way. The reforms reduce the inheritance tax advantages available to owners of agricultural and business assets, but still mean those assets will be taxed at a much lower effective rate than most other assets. Despite a tough fiscal context, the Government will maintain very significant levels of relief from inheritance tax beyond what is available to others and compared to the position before 1992.

These reforms are being introduced in a broader context of significant existing support for the farming industry in the wider tax system, which the Government is maintaining. The existing rules already provide considerable support for the agricultural sector beyond the general support for businesses. This includes the exemption from business rates for agricultural land and buildings, the ongoing entitlement for vehicles and machinery used in agriculture to use rebated diesel and biofuels, and the exemption from the plastic packaging tax for the plastic film used by farmers to produce silage bales. Furthermore, farmers are able to claim to add together their profits from farming for two years or five years and be taxable on the average of those profits.

The Government’s commitment to farmers and the vital role they play in feeding our nation remains steadfast. The Government’s decisions at Autumn Budget 2024 provide £5 billion over two years for farming and land management in England which will restore stability and confidence in the sector, strengthening food security alongside nature’s recovery. This is the largest ever budget directed at sustainable food production and nature’s recovery in our country’s history. Despite the difficult fiscal inheritance, funding has also been prioritised for the Farm Recovery Fund to support farmers with the impact of severe wet weather over the last year.