Farming inheritance tax: Opposition scaremongering, says FM

In her budget on Wednesday Rachel Reeves announced that from April 2026, a tax of 20% would be raised on the value of inherited farming assets above £1m.

Whilst the 20% figure still represents a tax relief of 50% compared to the standard rate, the move has been criticised by farming unions and opposition parties.

Andrew RT Davies said Labour politicians had previously insisted there were no plans for such changes, and he asked the first minister: “Do you understand the anger, the concern and the fear that farmers and those dependent on the agriculture industry feel when they have been so bitterly betrayed by your party?”

In response, Morgan told him to “stop scaremongering”, adding that “actually there will be a very small proportion of farmers in Wales that will be impacted by that inheritance”.

Plaid Cymru’s Delyth Jewell, standing in for party leader Rhun ap Iorwerth at First Minister’s Questions, also said farmers were “feeling betrayed”, claiming that the new policy “threatens the future of many Welsh family farms”.

Morgan responded that the “vast, vast majority” of farms in Wales would not have to pay the tax.

Despite the announced changes to the rules, other inheritance tax allowances mean that farmers could inherit assets to the value of nearly £3m without paying tax.

“There is a huge allowance when it comes to the agricultural community, and what we’re talking about here is extremely large and wealthy farms,” Morgan added.