Labour concerns on farm tax changes in Wales grows

The relationship between the UK government and the farming sector has "completely broken down" in the row over inheritance tax changes, a Labour MP has said.

Henry Tufnell, the MP for Mid and South Pembrokeshire, is the third Welsh MP from the party to raise concerns.

In a video posted on his Facebook account, he called for an "improvement to the policy" and said that the UK government should "bring the farming sector" with them.

The UK government said in a statement its commitment to farmers remained "steadfast".

Welsh First Minister Eluned Morgan, meanwhile, said the Welsh government recognises the "anxiety" the changes are causing, and that it was up to the UK government to defend the policy.

Tufnell said the farming sector was crucial for economic development and to meet environmental targets.

In Chancellor Rachel Reeves' Budget on 30 October it was announced inherited agricultural properties worth more than £1m would be subject to inheritance tax at 20% from April 2026.

The government has said the changes will only affect the wealthiest 500 farms each year, but farming groups argue as many as 70,000 could be affected.

The Pembrokeshire MP is the latest Welsh Labour politician to criticise the changes, after Montgomeryshire and Glyndŵr's Steve Witherden said the changes "risk having a deeply detrimental effect on working family farms".

Last month, Gower MP Tonia Antoniazzi backed calls for a pause.

"We need time to gather information to determine the full impact the changes will have to family farms in Wales," she said on Instagram.

In his social media video, Tufnell said: "The relationship between the farming sector and the UK government has completely broken down.

"There's a lack of trust and confidence, and its particularly around this issue around inheritance tax and the changes that were made in the budget in October.

"There needs to be a improvement to this policy because its so important that we as a government bring the farming sector with us."

A government spokesperson said: "Our reform to Agricultural and Business Property Reliefs will mean three quarters of estates will continue to pay no inheritance tax at all, while the remaining quarter will pay half the inheritance tax that most people pay, and payments can be spread over 10 years, interest-free.

"This is a fair and balanced approach which helps fix the public services we all rely on."

It recently emerged that Tufnell's parents transferred ownership of their farm land to one of their sons days before changes to inheritance tax rules were announced.

On 10 October, 2024, his father and mother, Mark and Jane Tufnell, passed Upper Colne Farm and Stud to another son, Albermarle.

There is no suggestion the Tufnells have done anything unlawful.

In the Senedd on Tuesday, Welsh Conservative Senedd leader Darren Millar raised the case of a farmer called Nigel in Monmouthshire, who is in his 80s.

He said Nigel had "allowed himself to dream of stepping back... and watching with quiet pride as his family carried out his life's work".

But he said "that dream was shattered" by the tax decision. Millar accused the UK government of going back on a promise not to change property relief.

Morgan told the Senedd it was up to the UK government to "defend their own policy".

"They were trying to make sure that those rich investors who were abusing the system actually were not able to take advantage of the tax loopholes," he said.

She later added: "I recognise that this is causing anxiety in the agricultural community.

"That's why we will continue putting significant support into supporting people with their mental health and well-being."