Town halls across the country are in open revolt against the “family farm tax”, with Labour MPs under mounting pressure on the policy.
In recent weeks, almost two dozen councils have passed motions calling on the Chancellor and Environment Secretary to axe the measure which they say is an “assault” on the countryside.
The 22 councils include those where Labour has newly elected MPs who are now facing rebellions from their town hall leaders.
They represent almost 10 million people, equivalent to 15.8 per cent of the population across England and Wales, or one in six Britons.
Under the changes, which come into force from April 2026, farms worth more than £1 million will be subject to a 20 per cent levy, half the usual inheritance tax rate.
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Rural groups have argued that the £1million threshold will hit the majority of working family farms, asset-rich but cash-poor, instead of targeting wealthy landowners seeking to avoid inheritance tax.
In Rushcliffe, where the Labour MP James Naish overturned a previous Tory majority, the district council passed a motion demanding that he lobbies the Chancellor to drop the plans.
Cllr Neil Clarke, the leader of Rushcliffe Council, warned that the changes to inheritance tax “threaten to cripple many family farms” which have “no means to pay such punitive amounts”.
Meanwhile, Jon Pearce, the Labour MP for High Peak, sidelined by his borough council, will be writing to the Chancellor directly to urge an about-turn.
Other town halls to pass motions expressing their dismay include Devon County Council and Norfolk County Council, where councillors hit out at the Chancellor’s “assault” on the countryside and “rural way of life”.
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Cornwall, Kent, Somerset, Suffolk and Buckinghamshire councils also passed motions against the policy.
About 50 rural Labour MPs have reportedly joined a WhatsApp group pushing to revise the policy, concerned about the impact on their constituents.
The MPs are said to want the £1 million threshold raised to hit wealthier landowners and are also pushing for the 20 per cent tax rate to be changed to the standard 40 per cent, to discourage the purchase of farmland purely to reduce inheritance tax.
Mo Metcalf-Fisher of the Countryside Alliance said: “The list of councils opposing the family farm tax is growing quickly and we expect more will be signing up in the New Year.
“This is undoubtedly a challenge for those rural Labour MPs representing seats in these council areas, many of whom understandably feel like they’ve been thrown under the bus by this hated policy.”
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He added: “But sympathy can only go so far – rural people need to see those MPs joining the rural sector in demanding a policy rethink. The Treasury needs to put ego aside and find a way forward out of this mess with rural experts, or risk it plaguing the Government until the next general election.”
A Government spokesman said: “Our commitment to farmers remains steadfast – we have committed £5 billion to the farming budget over two years, including more money than ever for sustainable food production, and we are developing a 25-year farming roadmap, focusing on how to make the sector more profitable in the decades to come.
“Our reform to Agricultural and Business Property Relief will impact around 500 estates a year.
“For these estates, inheritance tax will be at half the rate paid by others, with 10 years to pay the liability back interest free. This is a fair and balanced approach which fixes the public services we all rely on.”
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