Rachel Reeves told to ‘pause’ farm tax as supermarkets warn ‘security at stake’

Tesco has urged Chancellor Rachel Reeves to “pause” a £500 million tax raid on family farms and warned “the UK’s future food security is at stake”.

Britain’s biggest supermarket joined Aldi, Lidl, Morrisons and Asda in opposing the Chancellor’s decision to hit farms with inheritance tax bills.

Ashwin Prasad, Tesco’s Chief Commercial Officer, said: “Farmers desperately need more certainty. After years of policy change, it has been harder than ever for them to plan ahead or to invest in their farms.”

In a blog post on the firm’s official website, he said: “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.”

Mr Prasad said: “This is not just a debate about individual policies – the UK’s future food security is at stake.”

Lidl also called for a pause, saying: “We are concerned that the recent changes to the inheritance tax regime will impact farmer and grower confidence and hold back the investment needed to build a resilient, productive and sustainable British food system.”

And Aldi said: “We all need a farming sector that can confidently invest in its future and continue to produce high-quality British food. That’s why we are supporting the farming community’s calls for the government to pause the implementation of its proposed changes to inheritance tax.”

Treasury watchdog the Office for Budget Responsibility has said farmers are likely to slash investment because of the tax raid. It also cast doubt on how much money would be raised, although it said its “central estimate” is that the figure will be £500million by 2029/30.

Tom Bradshaw, president of the National Farmers’ Union, said the tax changes will hit older farmers hardest. He said: “One minute they were advised to keep their farms until death to pass them on to the next generation, the next they’re left knowing that if they live beyond April 2026 when the measures come in, their children may have to break up or sell the farm.”

Defending the tax change in Parliament on Tuesday, Ms Reeves said: “We announced £5 billion for the farming budget over two years, including the largest funding directed at sustainable food production and nature recovery in our country’s history, and £60 million to support farmers because of flooding.”