In an open letter to the chancellor, the NBA warned that proposed reforms to agricultural tax reliefs could devastate multi-generational farming businesses already under strain.
Currently, inheritance tax (IHT) is charged at 40% on estates worth over £325,000, with most farmland qualifying for agricultural property relief (APR) or business property relief (BPR). But from April 2026, sweeping Treasury reforms will introduce a £1 million cap on the value of assets eligible for full relief – a move the NBA says will hit family farms hardest.
Even before those changes take effect, the association says the system is forcing families to sell land, divide holdings and divert investment away from food production and sustainability.
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“This isn’t about privilege – it’s about permanence,” said NBA chief executive Neil Shand.
“Family farms are the backbone of rural Britain. They feed the nation, care for the land and support local economies. But right now, they’re being punished for trying to pass on what they’ve built. Unless the government rethinks inheritance tax, we risk losing not just farms, but futures.”
The letter describes the current IHT framework as 'unsustainable', warning that many long-established holdings are being broken up or sold to meet tax liabilities. Shand said the tax burden was leading to 'the slow, silent dismantling of the family farm', eroding both livelihoods and landscapes.
The NBA argues that the policy fails to reflect the reality of farming – a sector that is asset-rich but cash-poor, with wealth tied up in land, machinery and livestock rather than disposable income. For many, the transition between generations brings crippling financial pressure.
The association has called on the chancellor to launch a full and transparent review of how IHT affects agricultural businesses and rural communities.
“This is not a plea for privilege,” the NBA wrote, “but for fairness – for a system that values food production, recognises the environmental and social contribution of family farming, and protects the rural communities that sustain it.”
The warning comes amid wider industry concern about uncertainty over agricultural reliefs, inflation and rising input costs, all of which threaten investment in long-term sustainability and food security.
The NBA said that without urgent reform, the UK risks losing independent farm ownership, weakening domestic food production and accelerating rural depopulation.
“Inheritance tax, as it stands, could dismantle the very businesses that feed the nation and sustain its countryside,” Shand concluded.