The government has today (Tuesday 23 December) announced a significant change to its planned reforms to farm inheritance tax, raising the threshold for Agricultural and Business Property Relief from £1 million to £2.5 million ahead of its introduction in April 2026. The move follows sustained pressure from farmers, the National Farmers Union, and rural MPs including Luke Myer.
The change means most family farms will now face no additional inheritance tax, with couples able to pass on up to £5 million in qualifying agricultural or business assets between them. Ministers confirmed the reform will be brought forward through an amendment to the Finance Bill, significantly reducing the number of estates affected and easing the burden on working farms and elderly landowners.
Luke Myer MP abstained on the issue last year and had again earlier this month at the direct request of the NFU, after months of meetings with farmers in East Cleveland, correspondence with the Treasury, and representations in Parliament.
While previous Budget changes allowing spousal transfer of allowances were welcomed, Luke shared farmers’ concerns that the original policy risked placing unfair pressure on family-run farms that are central to rural jobs, food security and local identity.
Responding to the announcement, NFU President Tom Bradshaw said:
“I am immensely proud of all those farmers and growers who have worked with the NFU and supported our campaign. I would like to thank all those Labour backbench MPs that were contacted by farmers and growers and decided to stand by their constituents as demonstrated by the recent abstentions on the vote on Budget Resolution 50. We have spent the past year working with them and there’s no doubt their interventions behind the scenes have also played a huge role in securing today’s news.”
Greg Proll, NFU Group Secretary for the North Riding, said:
“We are grateful to Luke for consistently listening to farmers and the NFU over the last year. He stood with farmers.”
Luke Myer MP said:
“This change shows how listening and speaking out can make a difference. After more than a year of pressing for a fair settlement, I’m glad the government has moved to protect family farms, including many here in East Cleveland. Food security is national security.”
The Government’s Environment Secretary Emma Reynolds said:
“Farmers are at the heart of our food security and environmental stewardship, and I am determined to work with them to secure a profitable future for British farming. We have listened closely to farmers across the country and we are making changes today to protect more ordinary family farms.“
“It’s only right that larger estates contribute more, while we back the farms and trading businesses that are the backbone of Britain’s rural communities.”