As many as one in ten UK farmers could abandon the industry ahead of the new government’s Autumn Budget on the back of Capital Gains Tax and reduced subsidies, putting the future of British agriculture at risk, according to an agriculture expert.
Mark Chatterton, Head of Agriculture at Duncan & Toplis accountancy and business advisers, notes that a significant proportion of farmers in the East Midlands are currently considering selling their land, giving it to the next generation, or contracting out to bigger businesses.
He said that as farmers grappled with economic uncertainty, faced shrinking financial support and two successive poor harvests, the sector simply can’t survive without urgent investment. “The future of British farming is at a critical crossroads. This Autumn’s Budget could deliver a devastating blow if Capital Gains Tax is hiked as expected. Farmers are already struggling after poor harvests and diminishing subsidies—another financial hit may push many out of the industry for good.
“Confidence is at an all-time low, with DEFRA figures showing that nearly half of farmers fear for the future and the NFU revealing that confidence in the sector is at its lowest since records began. The Sustainable Farming Incentive is the last lifeline for many, but even that is only guaranteed for three more years. Without urgent investment, we could see a collapse in agricultural production.
“The new government has vocally affirmed the UK’s agricultural sector as a matter of the utmost national security – and I couldn’t agree more. I’d urge the government to apply firm and consistent support for the sector when it needs it most.
“For struggling farmers, we’re seeing an increasing number taking stock of their options. Those without clear succession plans seem to be considering seizing the opportunity to capitalise on historically high land prices before it’s too late. This makes sense to a degree, as waiting could prove a costly mistake if the Autumn Budget diminishes financial prospects further, but what could this mean for the sector as a whole?”
Mark Chatterton’s comments come as speculation grows that this year’s Autumn Budget will include major tax reforms, with Capital Gains Tax possibly rising to 45% and changes to Inheritance Tax expected to bring more farmers into its scope.
“Although the government has promised new measures to boost confidence in agriculture, it has yet to provide clear timelines. Chatterton says, “Farmers are hoping the Autumn Budget will turn these promises into reality – one with clear and decisive deadlines and deliverables.”
