Reeves’s decision to limit Agricultural Property Relief (APR) has drawn widespread concern and criticism among farmers, who view these reforms as potentially devastating for an industry already facing economic challenges.
Under the new proposals, farmers face reduced tax relief on inherited land, making it increasingly difficult to pass farms down through generations without significant financial strain. This has prompted some within the industry to consider “militant action,” such as strikes or disrupting food supply chains, as a response to what they view as an existential threat to their livelihoods and the farming heritage.
Figures such as Jeremy Clarkson have weighed in, suggesting that while Reeves’s policy may have been aimed at wealthy landowners, it risks harming traditional farming families instead. Clarkson argues that the reforms could lead to fewer family farms and thus reduce Britain’s agricultural output and rural employment. Many farmers share this concern, noting that APR has long been a cornerstone in preserving the intergenerational sustainability of farming families.
Furthermore, while the inheritance tax changes are among the most controversial aspects of Labour’s plans, Reeves’s budget also brought adjustments to direct subsidies, placing additional pressure on farmers already struggling with labour shortages and rising operational costs. The National Farmers’ Union (NFU) and other advocacy groups are lobbying for greater sensitivity to the unique financial challenges faced by small and medium-sized farms, fearing that without supportive policies, the industry could experience severe downturns.
Liberal Democrats leader Ed Davey.The unfolding debate signals a critical period for the UK’s agricultural future. Labour’s approach to balancing fiscal reform with agricultural viability may set a precedent for the sector’s treatment under future budgets and policy decisions.
Liberal Democrats leader Ed Davey told ITN that he sees Labour’s proposals as being “really worrying for farmers”.
“If you talk to the Country London Business Association, they’re really worried it’s going to affect far more farmers… I don’t know whether it’s a mistake by the government or whether they’ve just got it wrong. Either way, I think they need to withdraw. Rural communities depend on agriculture. It’s a key part of rural communities and to take this away when farms are passed on from generation to generation is I think a mistake.”
Our upcoming programme on the future of farming
Farming faces a multitude of challenges that impact productivity, sustainability and profitability. The impacts of climate change necessitate a shift from traditional farming practices to regenerative agriculture.
ITN Business’ news-style programme, ‘Future of Farming: Cultivating Resilience’ will explore how the sector is pioneering innovative farming solutions, collaborating with like-minded partners, and supporting the development of strong and resilient ecosystems, highlighting organisations demonstrating successful initiatives in this field.
Coming soon: Programme launching December 2024
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