On 28 November 2024, hundreds of farmers gathered at Holyhead Port in North Wales to protest against proposed inheritance tax reforms they argue threaten the future of family-owned farms.

Organised by the North Wales Farmers Alliance (NWFA), the demonstration highlighted growing concerns about the financial burden that inheritance tax reform could place on farming families, many of whom are already struggling with rising costs and slim profit margins.

The protest attracted farmers from a range of sectors, including livestock, dairy, and arable farming, all united in their opposition to proposals that could see inheritance tax liabilities rise for those passing down their farms to the next generation. While supporters of the policy argue that it is necessary to modernise the tax system and ensure fairness, critics, including many of those at Holyhead Port, fear that the changes could force small family farms to sell up, leading to the loss of long-established businesses and a deepening crisis for rural communities.

Key Concerns of Protestors

The protestors voiced several key concerns about the government’s inheritance tax proposals, particularly regarding the way agricultural assets are valued and taxed when farms are passed on to heirs. Under current rules, agricultural land and property can benefit from relief under Agricultural Property Relief (APR), which allows farms to be passed on with minimal inheritance tax liability. However, recent government suggestions to limit this relief, particularly for larger estates, have sparked fears that future generations may not be able to afford to take over the family business.

“We’re not just talking about land here,” said Gwilym Jones, a sheep farmer from Anglesey. “For many of us, a farm is not only a home and a livelihood, but also a legacy passed down over generations. But if these changes go ahead, it could mean that our children and grandchildren won’t be able to inherit the land without being hit with crippling tax bills. The stress and uncertainty is already overwhelming.”

Farmers are particularly concerned that the valuation of agricultural land for inheritance tax purposes is often higher than what they can realistically expect to earn from the land, especially when the farm is a small, family-run operation. “The land is worth more on paper than it is in reality,” explained Sarah Hughes, a dairy farmer from Conwy. “If we have to sell off parts of the farm to pay the inheritance tax, we could lose everything. This isn’t just about money—it’s about the future of farming in Wales.”

Government’s Position

The UK government has defended its stance on inheritance tax reform, claiming that it is necessary to create a fairer system for the distribution of wealth. A government spokesperson stated: “We recognise the importance of family farms, but we also need to ensure that the tax system is fit for the 21st century. The government is committed to supporting farmers and is working to make the transition to new rules as smooth as possible. We are considering options to support the next generation of farmers and ensure that small family-run farms are protected.”

Supporters of inheritance tax reform argue that the current system disproportionately benefits wealthy landowners and encourages the hoarding of land, which can exacerbate inequalities in the farming sector. However, many farmers remain unconvinced, feeling that the government’s proposals fail to recognise the unique challenges of farming businesses.

Impact on Local Communities

For farmers in North Wales, the proposed inheritance tax changes are not just an economic issue, but also a social one. Farming is a central pillar of the local economy, with many rural communities relying on agriculture for jobs, services, and tourism. The potential loss of family-run farms could have far-reaching consequences for local economies, with the risk of rural depopulation and the collapse of vital support industries.

“Farming is part of the DNA of our communities,” said Hywel Griffiths, an arable farmer from Denbighshire. “If we lose too many small farms, it’s not just the farmers who suffer—it’s the schools, the shops, the pubs, and all the other businesses that rely on us. It would be a blow to the whole area, and we can’t afford that.”

A Divisive Issue

The protest at Holyhead Port is the latest in a series of demonstrations across Wales and the UK, where farmers have raised concerns about inheritance tax policy. While some view the government’s proposed changes as a necessary reform of an outdated system, others feel that the policy is out of touch with the realities of farming life.

As the debate continues, it remains unclear whether the government will amend its proposals or introduce specific measures to mitigate the impact on small family farms. Farmers are calling for a more tailored approach that considers the challenges faced by rural communities and ensures that agricultural businesses can continue to thrive for future generations.

Looking Ahead

The debate over inheritance tax reform is set to continue in the coming months, with further discussions and consultations expected. Farmers in North Wales, along with their counterparts across the UK, are hoping that their concerns will be heard and that meaningful changes will be made to safeguard the future of family farming.

For now, the protest at Holyhead Port has brought the issue to the forefront, highlighting the deep anxiety felt by many farmers about the sustainability of their businesses and the ability of the next generation to take over the family farm. The future of agriculture in North Wales and beyond will depend on finding a way to balance the needs of tax reform with the realities of running a farm in an increasingly challenging environment.