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PA Media<\/p>\nMalcolm Priorrural affairs producer<\/p>\n
PA Media<\/p>\n
Farmers drove their tractors into Oxford city centre to protest over proposed inheritance tax changes<\/p>\n
There will be no more changes to already watered down plans to raise farm inheritance tax, the government has said. <\/p>\n
Protestors attempted to disrupt a speech on Thursday by the environment secretary Emma Reynolds at the Oxford Farming Conference with a horn-blowing tractor demonstration<\/p>\n
Last month, the government said its planned threshold for a 20% tax on inherited agricultural assets would be raised from \u00a31m to \u00a32.5m.<\/p>\n
When asked about further changes, Reynolds told the conference: “That’s it, I’m afraid… it is the people in this room who have engaged with us constructively and relatively quietly that have had an influence on this process, not the people sounding their horns.”<\/p>\n
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PA Media<\/p>\n
Environmental secretary Emma Reynolds said the government had listened to the concerns of farmers<\/p>\n
The raising of the tax threshold was seen by critics as a climbdown following months of protest over the original plans that were announced in chancellor Rachel Reeves’ first budget in 2024.<\/p>\n
But Reynolds told the conference that the government had been listening to farmers, who “aren’t shy about coming forward and giving you their views” and had now “significantly increased” the tax threshold that will come into effect in April.<\/p>\n
The government’s original proposals would have seen inherited agricultural assets worth over \u00a31m taxed at 20%, half the standard inheritance tax rate, raising an estimated \u00a3520m annually by 2029.<\/p>\n
The government had argued that the change would protect smaller farms while stopping wealthy investors from buying farmland as a tax loophole.<\/p>\n
However, in December, it stepped back from the original proposal raising the threshold level to \u00a32.5m.<\/p>\n
Coupled with an exemption which allows farmers to pass on assets to their spouses tax-free, the new policy means a couple could pass on up to \u00a35m in qualifying assets, without paying tax.<\/p>\n
However, the Country Land and Business Association (CLA), which represents rural land and business owners in England and Wales, said it would continue its campaign to “reverse the policy in full”.<\/p>\n
CLA president Gavin Lane said the government’s “partial climbdown” in December had come as a “welcome relief” but “was a further acknowledgement that their reforms were ill-thought through and deeply damaging”.<\/p>\n
Lane said the policy as it remains is still “so dreadful for the rural economy”.<\/p>\n
The National Farmers’ Union (NFU) said that it remained opposed to the tax in principle and would “push for further changes at the next political opportunity”.<\/p>\n
But president Tom Bradshaw acknowledged: “News of the change to the inheritance tax threshold just two days before Christmas, and days after my meeting with the Prime Minister, has been a huge relief for many farming families across the country.” <\/p>\n
“The change removes the tax burden from a significant number of family farms,” he added.<\/p>\n
Environmental payments<\/p>\n
The environment secretary also pledged there would be “no more sudden, unexpected closures” of farming payment schemes, as she set out reforms to the flagship environmental programme for England, the Sustainable Farming Incentive (SFI).<\/p>\n
Last March, the SFI, which pays farmers in England for “public goods” such as insecticide-free farming, wildflower strips and managing hedgerows, was suddenly closed because funding had been fully allocated for the year.<\/p>\n
At the time, the NFU described the closure as “another shattering blow to English farms”<\/a>.<\/p>\n There has been ongoing uncertainty since then over the programme, a key part of the environmental land management schemes (Elms) which replaced agricultural subsidies after Brexit.<\/p>\n