The tax change the right opposed may be helping farmers buy farmland

Almost two years ago, in November 2024, thousands of farmers descended on central London to protest against changes to agricultural inheritance tax announced by the new Labour government.

The campaign quickly attracted some high-profile supporters from the right, including Jeremy Clarkson, Nigel Farage and Kemi Badenoch. Further demonstrations followed in February and March 2025, with Farage and Badenoch again throwing their weight behind the farmers’ campaign.

Opponents argued that Labour’s reforms would threaten family farms, damage rural communities and put the future of British farming at risk.

Yet there is now a suggestion that one of the reform’s intended effects is beginning to materialise, making agricultural land less attractive to wealthy non-farmers seeking a tax-efficient investment, and potentially making it easier for farmers to buy farmland.

The changes, announced in the Autumn Budget 2024, ended unlimited 100% Agricultural Property Relief (APR) and Business Property Relief (BPR) from April 2026. Under the new rules, full relief applies only up to a £1 million combined threshold, with a 50% rate of relief applying above that.

The government has estimated that the reforms will affect around 200 estates a year. Yet much of the political campaign against them has been driven by claims about the threat to ordinary family farms.

There is a rather important part of this debate that has received considerably less attention.

Under the old system, wealthy landowners could pass agricultural assets on to their heirs with 100% inheritance tax relief, regardless of the value involved. That did not simply benefit people whose livelihoods depended on farming. It also made farmland an attractive asset for wealthy individuals looking for ways to reduce their inheritance-tax exposure.

In 2021, Jeremy Clarkson said avoiding inheritance tax was “the critical thing” behind his decision to buy his farm.

And when wealthy buyers compete with working farmers for a finite supply of land, the consequences are rising prices, making it harder for the next generation of farmers to get a foothold.

Tax Justice UK has highlighted concerns about the “super rich hoovering” up agricultural land to avoid inheritance tax.

Figures from land agents Strutt & Parker show that the proportion of farmland purchases made by so-called “lifestyle buyers” fell from 16% in 2024 to 11% in 2025.

At the same time, purchases by farmers increased to 59%, their highest proportion for seven years.

That is hardly evidence of the destruction of the farming sector.

It points in the opposite direction, farmers are accounting for a greater share of farmland transactions, while wealthy lifestyle buyers are accounting for less.

Strutt & Parker’s annual farmland review backs up the trend, finding that farmers accounted for more than half of purchases in England in 2025. It was the second consecutive year in which their share of purchases increased.

Though these figures are based on the number of transactions rather than the amount of land changing hands. Investors and other non-farming buyers can still purchase larger farms, meaning the picture looks less favourable to farmers when measured by acreage.

Even so, there are further signs that the extraordinary demand for farmland as an asset may be cooling.

Knight Frank’s Farmland Index found that the average price of bare agricultural land in England and Wales fell by around 5% during 2025, the largest annual decline since 2017.

None of this proves that Labour’s inheritance tax reforms are a complete answer to the pressures facing British farming. Farmers face a host of challenges, from volatile commodity prices and high input costs to planning, labour and the long-term effects of Brexit.

Nor does a fall in land prices automatically make farming affordable.

But it does challenge the narrative that reducing a tax break for wealthy landowners is necessarily an attack on farmers.

For decades, the tax system helped make agricultural land an attractive shelter for wealth. That could push up prices in a market where the supply of land is, by definition, limited.

If removing that incentive means fewer wealthy lifestyle buyers are competing for farmland and more working farmers are able to buy it, that is not an attack on farming.

It may be one of the things that helps keep farmland in the hands of farmers.