A cross-party committee of MPs is calling on the government to delay its inheritance tax reforms to avoid harming family farms and restore trust in British agriculture.
A report published today (16 May) by the EFRA Committee calls on ministers to delay final decisions on APR and BPR reforms until October 2026, with changes taking effect from April 2027.
MPs say a delay would “allow for better formulation of tax policy and provide the government with an opportunity to convey a positive long-term vision for farming,” while giving vulnerable farmers more time to seek advice.
The reforms to agricultural property relief (APR) and business property relief (BPR) unveiled in the autumn budget, are due to roll out from 6 April 2026.
But MPs who sit on the parliamentary committee say there was a lack of consultation and no clear impact assessment.
As a result, the potential consequences for land values, tenant farmers, and the agricultural sector remain “disputed and unclear.”
“Reforms threaten to affect the most vulnerable,” the MPs warn, urging the government to review alternative policy options put forward by experts, including the Institute for Fiscal Studies and the NFU, before enshrining changes in the 2026 Finance Bill.
A March 2025 survey referenced in today's report reveals a sharp decline in farmers' optimism: 70% of respondents felt positive about their business prospects before the Budget, dropping to just 12% afterwards.
In addition, 84% reported an impact on their mental health, citing uncertainty around the Sustainable Farming Incentive (SFI) and changes to inheritance tax.
The report also criticises the abrupt closure of the SFI in March 2025, which MPs say “affected trust in the government” and left many farmers without expected funding.
Though some applications can now proceed following a u-turn earlier this week, MPs urge a new funding scheme by September 2025 and clarity on the next SFI rollout and timeline.
Defra’s overall communication strategy also comes under fire, with EFRA's report accusing it of poor messaging and last-minute decisions, such as the surprise closure of the Capital Grants Scheme in November 2024.
These actions have led to what the committee describes as a “breach of trust” within the farming industry.
EFRA chair Alistair Carmichael MP said that farmers urgently need clarity, certainty and advance notice of changes — "they cannot be expected to rethink their businesses on a whim"
He said: "The committee has taken its work extremely seriously in developing this report and in agreeing our findings.
"There is an opportunity here to rebuild trust and confidence in the farming sector and I hope that the government will take our recommendations seriously.
“Changes to APR and BPR, the sudden closure of the Capital Grants scheme in November 2024, and the abrupt ending of SFI applications in March have all led farmers to feel that they cannot rely on the government to live up to its commitments.
"The government, however, seems to be dismissing farmers’ concerns and ignoring the strength of feeling evidenced in the months of protests that saw tractors converge on Westminster and up and down the country."
Responding to EFRA's report, Tim Farron MP, Liberal Democrat Environment, Food and Rural Affairs Spokesperson, said the 'family farm tax' was a 'hammer blow' to farms.
“Lib Dems have been hounding the government from the very start to axe the family farm tax and protect those farmers already hanging by a thread after years of being failed by the Conservative Party," he said.
“It’s about time the government started listening to farmers — and that starts by admitting they were wrong, listening to this report and ditching the family farm tax.”
The committee’s findings now await a formal response from the government.
