After months of political kite-flying and speculation, which has done more to raise fear than confidence, farmers can now take time to digest Labour's plans and what they mean for their businesses.
While Chancellor Rachel Reeves did not ride a coach and horses through the sector and abolish Agricultural Property Relief (APR) completely, the changes set out this week will seed more angst – particularly for tenant farmers, who make up 30% of the UK's farmed landscape.
READ NOW: Rachel Reeves confirms Agricultural Property Relief will apply up to £1m
Far from being a Budget which the Chancellor pledged would ‘protect small family farms', introducing a tax rate of 20% on everything above £1 million – considering land values are currently about £10,000/acre – will leave many with an extortionate tax bill.
For an industry which is known for the high risk/low-reward environment in which it operates the costs will be too high to bear.
Tax and succession planning - something many businesses are guilty of putting on the backburner - are now even more critical.
What has become clear in the long-running debate leading up to Wednesday's Budget, fuelled by leaks and countless briefings, is that there is a lack of understanding around the importance of reliefs like APR and Business Property Relief to the small- and medium-sized businesses which form the backbone of Britain. Reliefs not only allow farmers and rural business owners to continue producing healthy, nutritious food for the nation, but also maintain landscapes and, importantly, support the rural and national economies with jobs.
These businesses hold the keys to growth. Often intergenerational, they are absolutely key to the Government's desire to be a leader in science, technology and innovation, as well as its goals to increase carbon capture, fulfil house building targets and raise the bar when it comes to boosting nature.
Rachel Reeves said she wants to rebuild public services and, as we know, farming provides a public service, underpinning the majority of what society needs.
And it can do so much more with the right tools and fiscal instruments for growth.
As recent research by AHDB has shown, consumers' trust in farming is at a six-year high. The public trust farmers to deliver; the Government needs to do the same.
While farming bodies takes some time to digest today's financial changes, Defra says the legislation still needs to be passed and it is ready to listen.
We of course, will be keeping you up to date with analysis across all our platforms.
