Farmers protest against inheritance tax plan hurting agricultural businesses

On February 10, 2025, thousands of farmers gathered in Westminster, London, urging the government to abolish what they termed 'death taxes'. This protest marked the third time in four months that farmers rallied against an inheritance tax plan proposed by the Labour government. The new tax plan positions a 20 percent effective tax rate on agricultural assets exceeding £1 million, moving away from the traditional 40 percent rate for inheritance. Industry leaders have voiced their concerns that this policy may lead to a food crisis in the UK, asserting that many farm businesses could struggle under the weight of these tax liabilities. The implementation of this inheritance tax has been met with severe backlash from farming communities, as it could affect a significant number of farmers. The government's plan suggests that the threshold for paying inheritance tax could reach as high as £3 million after factoring in exemptions for couples and farm properties. However, farmers argue that the valuation of their land and business assets does not reflect their actual ability to pay taxes. The National Farmers’ Union (NFU) pointed out that while the nominal asset value may appear high, the returns on farming often do not provide enough liquidity to cover taxation without liquidating physical assets. Tom Bradshaw, the NFU president, commented on the distress that elderly farmers may face, expressing that these individuals might not live long enough to leverage gifting exemptions to pass on their assets without incurring tax penalties. Farmers have claimed that the government’s understanding of food production is lacking and that the concerns of those in the countryside need equal attention compared to their urban counterparts. This sentiment was echoed by farmer Oli Fletcher, who emphasized the necessity for support in food production just as there is a call for assistance to workers facing rising food costs in cities. The Treasury contends that the policy changes are necessary to fill a £22 billion fiscal gap and redistribute agricultural estate values more evenly among tax contributors. However, industry leaders and farmers argue that this plan is punitive to those who contribute significantly to food production. As they continue to voice their dissatisfaction, farmers maintain that the government's reforms could undermine the long-term viability of their operations, posing risks to both the agricultural sector and food security in the UK.