Farming families ‘deeply angry and frustrated’ over inheritance tax plans

A farming union stalwart from Caithness has warned that the UK government appears to be “hellbent” on pressing ahead with taxation plans that have caused outrage across rural communities.

Arnott Coghill spoke of the “substantial” impact of Labour’s 20 per cent inheritance tax raid on farmland and property worth more than £1 million.

He was speaking on the day an estimated 10,000 people joined in a rally in Westminster to protest against the plans. NFU Scotland, which took part in the event, claimed the budget measures had left farming and crofting families “deeply angry and frustrated”.

Inherited agricultural assets worth more than £1 million, which were previously exempt, will be liable to the tax at 20 per cent from April 2026.

Mr Coghill, of Skinnet Farm, Halkirk, is standing down soon from his long-term role as Caithness area president of NFUS.

“Local people have been talking about it because it will affect them, there’s no doubt about it,” he said.

“Even estates that are renting farms – will they have to sell some of them to raise funds to pay it? Because it will be substantial, and not even very big estates.

“It sounds like a lot of money, £1 million, but there are houses in the town that are half a million. It’s not a vast amount of money nowadays.

“Farming is being hit anyway, because the subsidies are being cut – so there is less money anyway.

“And if anything happens to somebody kind of quickly, if somebody dies, that’s the end of that business. It’s got a knock-on effect.”

The government has been accused of broken promises over the issue.

Mr Coghill said: “They’ve changed their mind on several things from what they said before the election. They seem hellbent on this.

“Big landowners have big amounts of land, but they have big amounts of expenses as well if they’re letting farms and things like that. It’ll trickle down, there’s no doubt about it.

“It’s not going to be a small number – it’ll affect quite a lot of people.”

UK environment secretary Steve Reed insisted the “vast majority of farmers will pay no more” and blamed the changes on the “£22 billion black hole” left by the previous Conservative government.

Chancellor Rachel Reeves has said the measures would not affect three-quarters of farms and would only impact large landowners, but NFUS and other farming unions dispute this.

NFUS called on the government to “reverse this decision immediately and sit down with industry to properly consult”.

Union president Martin Kennedy said: “For a government to have stepped away from its claim that ‘food security is national security’ and targeted taxation changes at family farms in its first budget has left farming and crofting families deeply angry and frustrated.

“Inheritance tax reliefs give certainty to family farms that they will be able to keep the farm in the family and keep producing food for the nation. Without this, the family will often have little alternative but to sell the farm, or part of the farm, to pay taxes.

“The resulting break-up of many family farms will have a devastating effect on rural communities which have small family farms at their heart.

“With the spectre of an unrealistic inheritance liability on death, there would be little incentive for a small farm or crofting business owner to take the long-term outlook and to invest in the future of the business. These changes could also result in a contraction in farmland available to rent, stifling the ambitions of the next generation of farmers.”

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