MP outraged by Finance Bill’s draft legislation on inheritance tax reforms

Carla Lockhart MP • July 24, 2025

Publication of the government’s draft legislation for the 2025-26 Finance Bill confirms that the Labour government is set to press ahead with its crippling inheritance agenda next year.

Upper Bann MP Carla Lockhart is outraged following this week’s unveiling of the draft legislation, which includes measures to reform Agricultural Property Relief (APR) and Business Property Relief (BPR) from 6th April 2026.

 

“The Labour government is not listening to the electorate. The Chancellor outlined her intentions in the autumn budget, and from the outset I have been strongly opposed to the proposals aimed at axing historical APR and BPR.

 

“Existing legislation was introduced by a previous Labour government to protect family businesses during periods of national economic turmoil. The current Labour government wants to levy a 20% ‘death tax’ on farm business assets over the £1m threshold.

 

“The government’s plans have come under fire for over nine months, and despite tractor protests in central London and immense backlash from farmers, industry stakeholders, politicians and rural communities, the Chancellor refuses to engage. She has set herself on a collision course to destroy generations of family farms and undermine national food security.

 

“Chancellor Rachel Reeves is etching her name in the history books for all the wrong reasons, creating a lasting legacy that will long out-live the current Labour leadership. “

 

Ms Lockhart added: “The Finance Bill presents another opportunity for the government to step-back and rethink its draft tax clauses.  We’ve witnessed numerous eleventh hour U-turns on controversial policy plans, and this one should be no different. This is an opportune time for the government to find reverse gear. They have wasted a number of prime opportunities and time is running out.

 

“The Prime Minister said, and I quote “getting this right is more important than pushing ahead with a policy that does not achieve its intentions”. The UK economy is struggling, the so called ‘inherited fiscal blackhole’ is deepening, and now the Chancellor is willing to sacrifice the country’s £48 billion agri-food sector which provides employment for over four million people.

 

“Sir Keir Starmer and the Chancellor are ignoring legitimate concerns and refusing to participate in roundtable talks. They cannot continue to dismiss genuine calls for a more balanced and practical way forward.”

 

The DUP Agriculture, Environment and Rural Affairs spokesperson, continued: “The evidence is overwhelming with numerous experts confirming that the government’s figures are mis-calculated. The proposed model could in fact run counter to the intended purpose of the policy. The government aims to tax investors and wealthy non-farming landowners who have exploited APR and BPR loopholes.

 

“In reality the £1m threshold is too low, especially when the value of farmland, sheds, livestock etc is taken into account. Small farms in Northern Ireland can easily exceed that figure.

 

“For years farmers have been encouraged to modernise, diversify and invest to expand their businesses, but now they are being penalised unfairly by this vindictive ‘tax grab’, a move which will destroy generations of family farms.

 

Ms Lockhart added: ”Several options are on the table, including raising the threshold, and an alternative ‘clawback’ mechanism designed to increase Treasury revenue, while protecting working family farms.

 

“I am fully supportive of the Westminster EFRA committee’s report which recommends pausing APR and BPR changes until October 2026. The cross-party plan would allow time for a robust impact analysis and meaningful consultation with industry stakeholders.

 

“Delaying the Chancellor’s plans would also provide a safety net for elderly and vulnerable farmers, giving them more time to seek professional tax advice. There are numerous concerns about a lack of advance consultation, or impact and affordability assessments.

 

“I am working with Alistair Carmichael MP, chair of the Westminster Agri-Select Committee, to delay the April 2026 deadline. There is too much at stake for farmers, rural communities, food security and the UK economy.

 

“The government claims its current plans won’t have “any significant macroeconomic impacts” and argues it is “not expected to have a material impact on food security”.

 

Carla Lockhart MP said: “Industry bodies are hugely critical of the Chancellor’s plans, but the government remains defiant. There is also mutiny within the corridors of Westminster, with Labour MPs from rural areas putting pressure on the Prime Minister to reconsider.

 

“Abolishing vital inheritance tax relief will drive farmers to the brink of despair. The demand for mental health services is rapidly increasing, while elderly and vulnerable farmers are distraught at the thought of seeing years of toil and devotion to build a sustainable business, under threat and at risk of being carved up and sold off to pay tax liabilities.

 

“Many have taken out life insurance policies, paying extortionate monthly premiums to protect beneficiaries and safeguard succession planning.

 

“Farmers are the custodians of the land, and the backbone of our rural communities and the wider economy. They should be respected and given a fair hearing. This pending tax burden will not be implemented without a fight. Our industry is standing shoulder-to-shoulder to do what it takes to overturn or reach a compromise on this deeply damaging ‘death tax’.

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