The NFU is one of 32 trade associations that have joined forces through an open letter to the chancellor, calling for a full consultation on the 'family farm tax'.
The letter warns that the inheritance tax changes announced in the budget will have ‘a severe and long-lasting impact on these businesses and the livelihoods of the millions of people they employ’.
Collectively, the 32 trade associations which signed the open letter, published by Family Business UK, represent more than 160,000 family businesses.
In the letter, leaders warned that the policy changes will ‘starve’ these businesses and the economy of much-needed investment, ‘leading to forced, premature business sales and the loss of jobs in constituencies across the country’.
They add that agricultural property relief and business property relief (APR and BPR) ‘are not loopholes’ but measures that exist to ‘allow profitable businesses to continue trading, without penalty, when the owner dies’.
Economic impact analysis produced by CBI Economics has revealed that between 2026-27 – 2029-30, the changes to BPR could reduce economic activity by £9.4bn.
It could also lead to more than 125,000 job losses – including among the SMEs the government is trying to support and protect – and result in a net fiscal loss to the Exchequer of £1.25bn.
The NFU's own impact analysis, produced in consultation with former Treasury and Office for Budget Responsibility economists, found that 75% of commercial family farms will be above the £1m threshold.
Even if the £2m threshold before the tax takes effect was considered, for many medium-sized farms inheritance tax bills spread over 10 years would wipe out the majority of their returns, the union said.
NFU president Tom Bradshaw said the open letter “further shows just how poorly thought through the inheritance tax changes are”.
He said: “As a signatory of the letter, we strongly echo the sentiment that the proposed tax could have far reaching consequences for the broader economy, employment and public finances.
“No one thinks this is a good policy, not even the government’s own advisers. It’s time for Treasury to listen to farmers and the multiple other organisations calling for these proposals to be opened up for consultation.”
CEO of Family Business UK Neil Davy added: “The model of family business ownership is unique. It powers the entire economy from farming to finance and everything in between.
"This letter, and those who have chosen to sign it, are testament to just how widespread family ownership is, and how committed we are to speak up on behalf of our members.
“Already, family business owners are taking decisions to withhold planned investments and are putting recruitment on hold.”
The letter comes as the NFU begins the next phase of its campaign to stop the family farm tax, with banners delivering this key message to government beginning to populate the UK’s major highways.
