Rachel Reeves’s tax raid on farmers is putting Britain’s food security at risk and must be paused, Tesco has warned, as the backlash to the controversial policy that has brought farmers to the streets mounts. The Telegraph has more.
Britain’s biggest supermarket said the Chancellor should halt the introduction of inheritance tax on farms worth more than £1 million in order to safeguard British agriculture.
Ashwin Prasad, Tesco’s Chief Commercial Officer, wrote in a blog: “This is not just a debate about individual policies – the UK’s future food security is at stake.”
Tesco was one of three major supermarkets to call for a rethink of the policy on Wednesday, with similar warnings issued by Aldi and Lidl in an unusual show of unity.
It came as the Office for Budget Responsibility (OBR), the Government’s fiscal watchdog, suggested that farmers were likely to slash investment because of the tax raid and cast doubt on how much money would be raised.
Tesco, Aldi and Lidl collectively represent around 45% of the British grocery market and their warnings about the impact of Labour’s tax raid significantly raises pressure on the Government.
Asda and Morrisons have already backed farmers in the row. Sainsbury’s has urged Ministers to “listen to the concerns of farmers about the tax changes”.
Under plans announced by the Chancellor in her Budget last year, farms worth more than £1 million will be liable for 20% inheritance tax from April 2026. Agricultural businesses were previously exempt from death taxes.
The policy has provoked a huge backlash from farmers, who claim it will force them to sell off or shut down businesses. Tractors descended on Westminster in November in protest over the tax raid.
Mr Prasad said Tesco “fully understood” farmers’ concerns and said they “desperately need more certainty”.
He said: “After years of policy change, it has been harder than ever for them to plan ahead or to invest in their farms. It’s why we’ll be supporting the National Farmers Union’s calls for a pause in the implementation of the policy, while a full consultation is carried out.”
In a further blow for Ms Reeves, the OBR said there is a risk that the amount raised by the tax will fade over time as landowners adapt following its introduction in April next year – although older farmers would be unable to escape the consequences.
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