Sir U-Turn Strikes Again: Starmer Relaxes Inheritance Tax Raid on Farmers Amid Rural Fury
Sir U-Turn has struck again as Keir Starmer says many more farmers will not pay death duties after Labour increased the tax-free threshold for farms from £1 million to £2.5 million. The Times has more.
In the latest Budget about-turn, after a year-long campaign by farmers, the threshold at which agricultural properties will pay inheritance tax will be increased from £1 million to £2.5 million from April.
It will mean farmers with a spouse or civil partner will be able to pass on a farm worth up to £5 million without paying inheritance tax.
A government source said the changes would mean that 85% of farms would not be liable for the tax, up from 75% previously.
Above this threshold farmers will pay an inheritance tax rate of 20%, rather than the 40% paid by other estates. Beneficiaries will have 10 years to pay the bill before interest is incurred.
The average net value of a farm was £2.4 million in the 2023-24 tax year, according to the Department for Environment, Food and Rural Affairs.
The National Farmers’ Union (NFU) welcomed the change, which came after a campaign by farmers.
And even more families are set to be caught in the net from April 2027, when pensions are to become subject to IHT. The Office for Budget Responsibility expects the change to result in the proportion of estates paying IHT to double to 10% by 2030.
Changes to how farms and family businesses pay IHT will also push up the tax take for the Treasury, which is expected to collect more than £14 billion a year in IHT by the end of the decade.
Worth reading in full.
While certainly a victory for farmers, it still leaves them worse off than before Labour came to power. As campaigner James Melville points out, it’s “a bit like someone who robs a family house and then expects praise from the household when they return half of the items that they have stolen”.
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Good news!
Particularly since, just like every other u-turn, it will make no difference to voting intentions,
The damage has been done.
Actually, I think maybe some extra thousands of waverers will see this as just too much incompetence to bear and will switch to Reform
Great news, and wonderful quote from James Melville in the final paragraph!
The Lord giveth and the Lord taketh.
So this miserable about turn slipped out after Parliament has shut down and handed to the current inept agricultural minister after the slime that is Reed to go and defend while Rache hides somewhere, goes some way to help BUT of course there are stll farms AND family firms that are worth more then either £2.5m or the combined £5m. A suggestion that Two Tier could not survive all the dead farmers who, after enjoying one last Christmas and a pint in the pub Reeeves is forcing to close, then hung themselves in a barn for the good of their families before the April deadline. But in other news is these townie idiots bringing in more legislation to increase costs on the farming community over animal welfare that will not apply to imported food. A punchline this morning on GB News was that had we remained in the EU these changes would not be permitted.
Farmers need to continue the fight, this is still only a partial victory.
At the very least it should be returned to where it was before this shower of shite came to power and started breaking everything!
Despite their massive majority from only 20% of the electorate, this government is totally spineless, thankfully that is one of their positive traits, at least in this instance.
The NFU have essentially given in, they have accepted the principle of taxing family farms.
In the south and the Cotswolds the farm house, and the barns would in most cases be valued in excess of 2.5 million that’s before the land, the equipment and livestock are taken into consideration
Labour is an enemy of the Countryside and rural communities, they have won here.
Remember that
Taxation on capital is communism. Tax should only be incurred on the profit produced by financial transactions. Dry taxation always kills the goose that lays the golden eggs. We need to get back to this principle before it is too late.
Like all Labour schemes, this is set to go wrong. A pound to a penny it will cost more to administer than it raises
Someone needs to ask Two-Tier at the first New Year PMQs how many farmers have committed suicide between Theeves First Budget when the IHT was announced and yesterday, when they finally partially reversed it.
He and his Ministers disgust me.
https://www.telegraph.co.uk/business/2025/12/23/my-father-would-still-be-alive-if-labour-acted-sooner/
This IHT needs to go completely. If not, they will freeze this threshold and due to inflation farms will be at risk again in a few years time.
I think the government is running scared of the potential of French-like farmers protest.
Exactly – only a total removal of the plans is acceptable, as you say inflation will naturally catch up with this and we are back to square one. I wouldn’t be surprised if this was their plan all along to be honest – clearly some bigger thinkers setting strategy above this shower…
https://www.telegraph.co.uk/business/2025/12/23/my-father-would-still-be-alive-if-labour-acted-sooner/
Oh look. Number 10 says – fuck off, we don’t want to hear your opinion…
“Contact Number 10Thank you. The Prime Minister’s Office is currently receiving an exceptionally high volume of emails. If your message concerned an issue relating to the responsibilities of another Government Department or public authority then you should resend it to them. The Prime Minister’s Office is, at this time, only able to consider matters directly relating to the Prime Minister and will not reply to emails that could have been dealt with elsewhere or which are of a general nature.”
https://contact.no10.gov.uk/VerifyMessage.aspx?id=38bafc3a-daa3-4350-ace1-05abef0da4bb
Masterplan to get Keith some popularity.