'It's massive' Budget hits farmers, but are concerns overblown?

For Will Oliver, an arable farmer in Leicestershire, Labour's first budget in 14 years was a shock: despite the signals beforehand that inheritance tax was going to be a key source of tax revenue, his reaction was still one of disbelief. "I didn't think they were going to do it," he said. "This is big. It's massive."

- Jasper Jolly Peter Walker

Agricultural property has been passed on to heirs tax-free for decades, but the chancellor announced on Wednesday that from April 2026 farms and other business property will fall within inheritance tax. Inheritors will have to pay 20% of the value of the agricultural and business property above £1m, raising £1.8bn by 2030 that can be used to improve public services.

Rachel Reeves's announcement caused uproar among much of the farming sector, and opposition parties rounded on the government. Yet many tax experts argue that for all the political backlash, the vast majority of family farms will still not pay a levy that is aimed at some of the wealthiest in Britain.

The National Farmers' Union complained that Labour had broken a promise not to tamper with agricultural property relief. Victoria Vyvyan, president of the Country Land and Business Association, said it was a "betrayal".

Oliver argued that the tax will add an extra cost for farmers. If working farms have to find that money, "food prices are going to have to go up, surely", he said.