Farming review chief calls for impact assessment of inheritance tax changes

Ministers must carry out an impact assessment of plans to charge inheritance tax (IHT) on family farms, an influential farmer who led a review into farm profitability has said.

Baroness Minette Batters, the former head of the National Farmers’ Union (NFU), raised concerns about farmers contemplating suicide to avoid the tax changes.

In a wide-ranging interview with the Sunday Times, she said she was “really nervous” about the impact of IHT on farmers’ “mental health, on suicides”.

She added: “I’m nervous about what this means for those that are elderly and vulnerable.”

Last week, the crossbench peer said in an independent review for the UK Government that a “new deal for profitable farming” is needed, which recognises the true cost of producing food and delivering for the environment.

Speaking to the Sunday Times, Lady Batters also suggested that UK Government officials, particularly in the Treasury, did not appear to value farming.

She said: “In my time at the NFU, when I spoke with the Treasury and others, they would say, look, farming couldn’t matter less, it is 0.6% of GDP.

“I would argue that this is a lot of the challenge with IHT: that if you don’t value a sector, you don’t mind losing parts of that sector.”

Lady Batters warned of the need to support farms in order to ensure Britain has a secure, local food supply.

“In the global context, war in Europe, we should be making sure we are as resilient and food-secure as we can be,” she said.

The senior farming figure’s concerns come after the Prime Minister was recently challenged by a senior Labour MP over claims farmers were contemplating suicide to avoid paying IHT.

Speaking at the Liaison Committee on December 15, Labour’s Cat Smith asked if Sir Keir Starmer was aware some farmers with a terminal illness were “actively planning to expedite their own deaths” before the inheritance tax break is removed.

Sir Keir told her: “I’ve had discussions with a number of individuals who have drawn all manner of things to my attention.”

Alistair Carmichael, a Liberal Democrat member of the committee said: “Nobody should be left feeling, as Cat Smith has just described, that they would be better off dying between now and next April.”

Sir Keir told him: “No, of course. But governments have to bring about sensible reform.”

Under plans introduced in Labour’s first Budget last year, farmers will for the first time pay inheritance tax on farms worth more than £2 million, from April 2026.

However, they will pay it at a reduced rate of 20%, rather than the standard 40%.

The UK Government has claimed this will impact only the largest farms, but farming representative groups disagree, and say it will drag in middle-sized family farms too.