The Ulster Farmers’ Union (UFU) has formally proposed a full reversal of the inheritance tax changes affecting farmers, urging Prime Minister Andy Burnham to scrap the measures introduced by former Chancellor Rachel Reeves. The proposal comes after the changes sparked widespread backlash last year, with the UFU insisting that a complete reversal is necessary to demonstrate that the new government is listening to farm families.
UFU Calls for Full Reversal
UFU president John McLenaghan said: “Before becoming Prime Minister, Andy Burnham recognised the devastating impact that the measures would have on family farms and committed to looking again at Agricultural Property Relief and Business Property Relief. Now it’s time to follow through on that commitment.”
McLenaghan added: “The Prime Minister’s comments over the weekend are encouraging. A full reversal of the changes would be a clear opportunity for the new government to demonstrate that it is listening to farmers and serious about resetting that relationship.”
Current Relief Thresholds
As it stands, 100% Agricultural Property Relief from inheritance tax applies to the first £2.5m of qualifying agricultural and business assets that can be transferred between spouses or civil partners, with 50% relief applying thereafter. This £2.5m threshold was introduced after initial plans to cap the 100% relief at farms with land and buildings worth £1m or less.
Despite these adjustments, McLenaghan argued that the changes do not go far enough. He said: “The changes to the damaging policy were a step in the right direction and have instilled a sense of relief for many farming families, but they do not go far enough and uncertainty remains for some. We need a full policy reversal.”
Looking Ahead to Autumn Budget
The UFU is now pressing the government to use the autumn budget or other tax measures to deliver a policy that secures the future of family farms. McLenaghan added: “We hope the Prime Minister will honour his commitment to look again at the measures. The government must use the autumn budget or tax measures to deliver a policy that protects the future of family farms and gives the next generation confidence to invest in the industry.”
He concluded: “A full reversal of the changes is necessary. We continue to ask all political parties at Westminster to ensure a complete policy reversal remains a priority in manifestos ahead of the next election.”
