Councillors set to clash over farming tax plans

Nearly 150 farmers and agricultural workers from the Melton area last week joined a national NFU protest in London against the measure because they say it will financially damage many family farms and stop them being handed down to future generations.

From April 2026, a 20 per cent tax will be charged on inherited farms which are valued at over £1million.

The government say only around 500 of the UK’s 209,000 farms will be impacted and that farmers will only pay half of the 40 per cent inheritance tax levied on other property owners.

Councillor Pip Allnatt, the Labour leader of Melton Borough Council, has written to the government to express the council’s concerns over the tax plans for farms and the potential negative impact on them although he feels there is a nuance to the debate.

Part of his letter reads: “I suggest that some farmers operating under the existing, long established APR regime have expected to continue living on family farms after retirement and drawing an income rather than a pension. The proposed changes unfairly penalise them...My sympathy does not extend to those ‘property owners’ and recent converts to part-time farming and full-time adherents of tax avoidance.”

He has also submitted a motion to the council’s December 5 issue which calls on the authority to adopt a stance which calls on the government ‘to implement fiscal changes in a more nuanced and selective way and to avoid unintended consequences for those who the Prime Minister described as the ‘backbone’ of a nation that seeks to produce more food sustainably within the UK’.

An alternative motion on the issue has been submitted to the meeting by Conservative councillor Simon Orson, who coordinated the local farmers attending the recent London protest.

He will call on members to request the leader sends a second letter to the Secretary of State for DEFRA urging him to put an end to the plan to levy the inheritance tax on farmers.

Councillor Orson wants the council to adopt a stance stating that the government has ‘committed a shameful betrayal and let down farmers by breaking their promise to not introduce a Family Farm Tax’.

He believes the council should emphasise the detrimental impact the tax would have, stopping farmers passing on their farms to their children, threatening food security by forcing the sale of farms and making food production more difficult in the UK.

Part of his motion reads: “The comments made by Secretary of State for the Environment, Food and Rural Affairs Steve Reed that already struggling farmers will have to ‘do more with less’ show distain for farmers and the sector.

“At a time when many farmers in the borough of Melton are struggling with soaring costs and energy prices, this sudden tax rise will damage the future of their farms.”

At the meeting, Councillor Orson will also call on the portfolio holder for town centre growth and prosperity to engage with local farmers and community representatives on what support the council can give them and to produce a list of farms which will be affected by the new tax.