23-05-2025
Family farm inheritance tax changes slammed as "disastrous" by Perth and Kinross councillor
Bailie Claire McLaren said generational family farming businesses in Perth and Kinross - and across Scotland - were "reeling from this ill-informed tax"
A Perth and Kinross councillor has slammed changes to family farm inheritance tax as "disastrous".
At the 2024 Autumn Budget, Chancellor of the Exchequer Rachel Reeves announced agricultural property relief (APR) and business property relief (BPR) would be reformed.
The Strathtay ward councillor spoke out after a report by Westminster's Environment, Food and Rural Affairs Committee called on the UK Government to delay implementing the changes and consider alternative reforms before justifying its final approach.
Bailie Claire McLaren is the Scottish Liberal Democrat spokesperson on Agriculture and Rural Affairs.
As part of the Autumn Budget, the UK Government announced that - as of April 6, 2026 - the 100 per cent inheritance tax relief on combined agricultural and business assets would be capped at £1 million. Thereafter landowners would access 50 per cent relief from inheritance tax and pay inheritance tax at a reduced effective rate up to 20 per cent, rather than the standard inheritance tax rate of 40 per cent. It would be payable in instalments over 10 years interest free.
Full exemptions for transfers between spouses and civil partners would continue to apply.
However, a cross-party report - published on May 16 by the House of Commons Environment, Food and Rural Affairs Committee said delaying implementing the controversial reforms "would allow for better formulation of tax policy and provide the Government with an opportunity to convey a positive long-term vision for farming".
The report raised concern reforms were announced without adequate consultation, impact or affordability assessments and "threaten to affect the most vulnerable".
The MPs have called on the UK Government to delay announcing its final agricultural property relief (APR) and business property relief (BPR) reforms until October 2026, to come into effect in April 2027.
Responding to the committee's report, Perth and Kinross councillor Claire McLaren said: "The UK Government's disastrous family farm tax has been a hammer blow to many farms up and down the country.
"Generational family farming businesses in Perth and Kinross and throughout Scotland are reeling from this ill-informed tax. Despite the resilience of the sector, this ill-informed tax has brought the sector to its knees. It is hoped this report has a positive impact with alternative approaches coming forward.
"The Scottish Liberal Democrats have been urging the UK Government from the very start to axe the family farm tax and protect those farmers who have already been failed so badly by the Conservative Party's unfair trade deals, rocketing bills and plunging incomes.
"It's about time the UK Government started listening to farmers — and that starts by admitting they were wrong and ditching the family farm tax."
