More than 200 tractors, trucks and other machinery congregated on the Royal Welsh Showground today to outline the shocking effects of UK Government’s inheritance tax plans on the rural economy.

NFU Cymru brought together farmers and representatives from rural businesses across Mid Wales for a striking display showcasing the far-reaching impact of the planned changes to inheritance tax reliefs announced in the Autumn Budget. Those plans – dubbed a family farm tax – could force many farmers to sell their family farms to pay a tax bill that, for many years, they have been protected from to help keep their businesses viable and enable them to keep feeding the nation.

Those gathered at the Royal Welsh Showground in Llanelwedd, Builth Wells on Friday 21st February heard an address from keynote speaker Alistair Carmichael MP, Environment, Food and Rural Affairs (EFRA) Committee Chair. During his address to the crowd, Mr Carmichael recognised the vital role that farmers were playing in feeding the nation and championed their role in driving rural growth.

Also present was Brecon, Radnor & Cwmtawe MP, David Chadwick, who spoke of farming’s importance as the largest employer in his constituency. He challenged UK Government to stop, consult and properly assess the impact of its proposals.

The rural community support day hosted by NFU Cymru came in the same week that the UK Treasury emphatically rejected an industry-led solution to the tax issue. That revenue neutral proposal, and its ‘claw back’ mechanism, would have offered a reprieve for the significant number of farm businesses affected by the proposed changes to Agricultural Property Relief (APR) and Business Property Relief (BPR). Instead, UK Treasury has vowed to continue with its plans, despite substantial evidence and calls from industry, MPs, tax advisers and the independent Office of Budget Responsibility (OBR) warning of its seismic impact on farmers and the rural economy.

NFU Cymru Brecon & Radnor County Chairman Rob Powell, who helped organise the rural community support day and opened the event on the Royal Welsh Showground, said: “The gathering of tractors and vehicles here today encapsulates just how wide the concern and impact of this proposed policy has spread across rural Wales. Put simply, the growth of the rural economy is reliant upon profitable farming businesses who reinvest those profits in the local community. UK Government’s proposed changes to APR and BPR puts the future of so many Welsh farms in jeopardy, resulting in a contraction of farming expenditure that has a significant knock-on effect for those rural businesses who count farmers amongst their customers. For many of those rural businesses who have attended today, the impacts are already being felt with farmer confidence plummeting and investment on many farms being shelved given this high level of uncertainty. UK Government cannot ignore the impact of this ill-considered policy on farmers and the stifling effect it is having on the wider rural economy.”

EFRA Committee Chair Alistair Carmichael MP said: “The damage to the rural economy done by a so-called budget for growth is already beginning to appear. That budget has had a chilling effect on confidence within the sector as farmers cancel or postpone any major investment.

“DVLA figures - analysed by the Agricultural Engineers Association - show that the number of new tractor registrations in 2024 fell by 13% against 2023, with the biggest falls coming in the last quarter of the year. Here in Wales the figure was actually a fall of 15.3%. This year so far we only have figures for one complete month but that is showing a 10% fall against the same month in 2024.

“The Chancellor may have wanted a budget for growth but the budget measures - compounded by Treasury’s subsequent behaviour - has killed confidence to invest amongst farmers.

“If farmers do not have confidence to invest then, whatever happens in the towns and cities there will be no growth in the rural economy. In fact, we shall be lucky to see it flatline.”

NFU Cymru Deputy President Abi Reader closed the event, summarising the union’s work on the #StopTheFamilyFarmTax campaign and outlining further lobbying in the coming weeks.