South West MPs under pressure over Budget’s anti-farming measures

Letters have been sent to MPs of all parties across the region condemning the announcement that the farming budget was to be frozen – a cut in real terms – and the introduction of a cap on agricultural property relief (APR) and business property relief (BPR).

The letter calls on MPs to put pressure on the Chancellor to change course and build a rural economy that can feed the nation, improve the environment, create jobs and generate economic growth.

From April 2026, Agricultural Property Relief (APR) and Business Property Relief (BPR) will be capped at £1m in total per owner. Qualifying assets beyond this level will receive 50% relief from inheritance tax, resulting in an effective tax rate of 20%, after using the nil rate band of £325,000 and residence nil rate band of £175,000. Despite government assurances that “small farms” won’t be affected, the CLA’s analysis shows tax changes could prove a death sentence for many small and medium-sized farms.

For example, a typical 200-acre farm owned by an individual with an expected annual profit of £27,300 would face an IHT liability of £435,000. If spread over a period of ten years, this would require the farm to allocate 159% of its profit each year to cover the tax bill. To meet this bill, successors could be compelled to sell 20% of their land. Similarly, a 250-acre arable farm owned between a couple in the way the Chancellor expects to be possible with an expected annual profit of £34,130 would face an IHT liability of £267,000, amounting to 78% of its profit each year over a decade.

Ann Maidment, South West Regional Director for the Country Land and Business Association, commented: "The Chancellor’s announcement will have consequences for hard-pressed farmers, consumers and the environment. Labour promised to be the party for the countryside, for growth, and vowed not to cut inheritance tax reliefs. Now they have broken these promises. How can rural Britain trust them again?

“The government appears to think inheritance tax reliefs for farmers are ‘loopholes’. In reality, they are targeted reliefs designed to protect Britain’s rural economy, jobs and food security. And this isn’t the only challenge that the farming community will be facing. The real term cut to the agriculture budget in England will mean that the Government's own ambitions and targets for nature will be impossible to deliver.

“The fear and anger felt by farmers and rural businesses cannot be overstated. There is enormous growth potential in the countryside, but we need the government to be working with us, not against us.”

In December, the CLA South West are running an informative Agricultural Transition Plan Roadshow - Making ELMs work for your business and Budget update - across the south west.

During these two-hour sessions attendees will hear from:

• CLA Experts who will look into the latest policy development under the new Labour Government, including SFI, CS and other transition schemes.
• Albert Goodman who will breakdown the key highlights of the Autumn Budget, and discuss their implications, providing you with practical advice on how to plan ahead.
• Ricardo who will highlight how they can offer farm businesses advisory support
• Catchment Sensitive Farming who will outline their free advisory offer.

These events will be held at the following venues:

• Tuesday 3 December: Royal Agricultural University (9.30am) and Junction 24 Sedgemoor Auction Centre (2.30pm).
• Wednesday 4 December: Scorrier House, Redruth (9.20am), and Two Bridges Hotel, Yelverton (2.30pm).

These events are the perfect opportunity for members and non-members alike to have conversations with experts in the field and ask specific questions relating to their business.

These events are free to attend but registration is required. To register, visit the CLA’s website – www.cla.org.uk/events.

Members and non-members requiring support with their booking can contact the CLA South West office on 01249 599059.