Treasury ministers are standing by farm tax plan

TREASURY ministers have stood by the decision to bring farms into inheritance tax next year.

- WILL DURRANT

Farmers gather during a demonstration on Whitehall last year in London

(Getty)

Exchequer Secretary Dan Tomlinson said the Government made “the right decision” at last year’s budget to end a tax relief for farmers, when they pass on agricultural property.

From April 2026, farm landowners will pay inheritance tax at an effective rate of up to 20% on their agricultural land, but can pass on agricultural and business estates worth up to £1 million without facing a bill.

Mr Tomlinson faced Labour backbench calls to look at tweaks, set out in a Centre for the Analysis of Taxation (CenTax) report into the changes.

CenTax proposed a “minimum share rule’, so that landowners whose farms and businesses make up a small share of their estate - less than 60% - would see a higher tax rate.