Newly released documents show the Treasury had not finalised inheritance tax reforms for agricultural property as late as September, raising questions over the government’s handling of rural tax policy.
The row centres on proposed changes to agricultural property relief (APR) — a key inheritance tax break designed to help family farms pass down land and assets without facing crippling financial penalties.
A Freedom of Information (FOI) request submitted by the Liberal Democrats revealed that the Treasury had “not finalised” the legislation and that “provisions remain under review”, despite ministers previously suggesting the matter was settled.
The controversial measure will see agricultural property relief (APR) capped at £1 million from April 2026, with anything above facing a 50 percent liability.
Farmers have warned that families could be forced to sell land, livestock and equipment to pay the bills, leaving businesses unviable.
The revelation comes just weeks after food security minister Angela Eagle confirmed the government would not be reconsidering proposed reforms to APR — a stance that prompted sharp criticism from farming and rural groups.
There are now growing calls for full transparency ahead of this month’s autumn budget, with campaigners urging ministers to rule out any reforms that could threaten the viability of family-run farms across the country.
Sarah Dyke MP, the Liberal Democrat spokesperson for rural affairs, said the FOI findings proved that the government had been less than open about its intentions.
“It seems that despite all their denials, the government did have plans to review the damaging family farm tax,” she said.
“For months now, thousands of farmers have been spending sleepless nights, consumed by anxiety about the future of their farms and livelihoods. We need clarity, not bickering and infighting from a government that simply doesn’t understand farmers.”
Rural groups have urged the chancellor to rule out any changes to APR in the upcoming Budget, warning that maintaining the relief is vital for the survival of family businesses.
“This cruel and unjust policy cannot go ahead. The chancellor needs to tell us all the truth about what is going on and make the right choice to save family businesses — axe the tax,” Dyke said.
Agricultural property relief allows qualifying land and assets to be passed on without incurring large inheritance tax liabilities — a measure long viewed as crucial for the continuity of family farms.
Farmers’ groups and rural MPs have repeatedly warned that altering or scrapping the relief could accelerate the decline of smaller farms and further destabilise the rural economy.
With the budget just weeks away, rural communities are watching closely to see whether the chancellor will provide long-awaited reassurance — or push ahead with reforms that could reshape the future of Britain’s family farms.
