Following the electoral boundary changes, the new constituency of Solihull West & Shirley contains approximately 30% agricultural land, including a variety of farmland. The farmers who work this land are invariably based in small family farms, which have been passed down through the generations.
The Chancellor's decision, in the new Government’s first Budget, to cease full agricultural property relief (APR) as of April 2026 will have a devastating effect upon farmers up and down the country.
Following this announcement, Neil supported farmers by joining a rally in Westminster in November 2024, where he met a local farmer, James, from Braggs Farm.
The Government has said that only 27% of farms will be affected. However, after analysis, it was confirmed that this figure was based upon historic HMRC data from 2021-2022. It is therefore not a reliable representation of the prevailing conditions come April 2026 and thereafter.
With the increasing price of land in the period since 2021 to now, even if price growth subsequently slows by April 2026, the value of land, and therefore the number of farms within the scope of this measure, will be far greater than that estimated by the Government.
Based upon the NFU's own calculation, the Government's estimate is out by a factor of around three. And, of course, the HMRC data is based upon APR alone. That is not representative of the reality of the situation; because in the region of 40% of those claiming APR will also claim business property relief This means bringing claims under both reliefs, within the same £1 million threshold, is much more restrictive than implied by the APR data in isolation.
The Government’s decision not to permit the transfer of the £1 million relief between spouses will specifically punishing widows, who will now face an impossible bill at a time of grief.
Additional factors, such as the impact of National Insurance Contribution rises and the Employment Rights Bill, will have a knock on effect upon the rural economy and supply chain costs; creating a tinderbox ready to ignite.
The Government has proposed a 10 year payment window for inheritance tax: suggesting that this would alleviate the significant financial strain on farms. But that is simply not the case. It demonstrates a fundamental misunderstanding of the profitability of farms. Farms may be asset rich, but they are also cash poor. They simply do not turn over enough profit to weather the storm of such an inheritance tax bill.
In many cases the only option, which in reality is no option at all, will be to sell off some of their land or business, which in turn makes their farm economically unviable.
At an Opposition Day vote in the Commons in December 2024, Dr Neil Shastri-Hurst voted against the Family Farm Tax, as he continued to support our farmers.