Britain’s family farms risk being “quietly dismantled” by an outdated inheritance tax system unless the government takes urgent action, the National Beef Association (NBA) has warned in an open letter to the prime minister.
Inheritance Tax (IHT) is levied at 40% on estates over £325,000 and agricultural land is usually eligible for Agricultural Property Relief (APR) or Business Property Relief (BPR).
However, the Treasury has approved sweeping reforms from April 2026 that will introduce a £1 million cap on the value of assets eligible for full relief. The NBA and others have warned that the move could hit family farms the hardest.
The NBA says the system is pushing family farms to the brink, forcing them to sell land, divide ownership and divert investment away from food production and sustainability, even before these reforms take effect.
Neil Shand, the group’s chief executive, said the issue was now a critical issue for thousands of farmers who were being punished simply for trying to protect their heritage.
“This is not a question of privilege, it’s a question of permanence,” he says. “Family farms are the backbone of rural England. They feed people, protect the land and support local economies.
“But now they are being punished for trying to inherit what they have built. Unless the government reconsiders inheritance tax, we risk losing not only our farms but our futures.”
In an open letter, the NBA warns that the current IHT framework is putting unsustainable pressure on multi-generational family farms, many of which are being demolished or sold to meet their tax obligations.
Mr Shand warned that if reforms were not introduced soon, IHT could “slowly and quietly dismantle family farms”, eroding not only livelihoods but also the landscape and heritage that characterizes the British countryside.
The NBA argues that the current tax system fails to recognize the asset-rich but cash-poor nature of agriculture, where most wealth is tied to land and livestock rather than disposable income. As a result, families seeking to pass on assets between generations often face devastating financial burdens.
The association is calling on the Prime Minister to launch a full and transparent review of how IHT will affect farming operations and rural communities.
The call comes amid industry-wide concerns that uncertainty around farm tax cuts, coupled with inflation and rising input costs, is undermining sustainability and investment in long-term food production.
The NBA stressed that its request is not for special treatment, but rather to recognize equity and the important role that family farms play in feeding the nation and sustaining rural economies.
“We are not asking for immunity or privilege,” the letter said. “We want a system that respects food production, recognizes the social and environmental contributions of family farming, and protects the rural communities that support it.”
The NBA’s intervention adds to calls from across the agricultural sector for tax reforms that support the sustainability and resilience of family farms.
The group warned that if the current trajectory continues, the UK risks a decline in independent farm ownership, reduced domestic food production and further declines in rural populations.
Without urgent reform, Shand concluded, inheritance tax could dismantle the very business that feeds the country and sustains the countryside.
