Government criticised for lack of transparency in relation to IHT

Exchequer secretary to the Treasury James Murray has repeatedly talked down the clawback mechanism, a proposal submitted to the Treasury by the CLA and other leading farming bodies. 

The CLA lodged Freedom of Information requests asking for the evidence behind these statements to be published, but the government is claiming it is not in the public interest to do. 

The CLA and a dozen other industry bodies from across the British economy have now written to the chancellor, urging her to rethink the decision and publish the evidence. 

CLA president Victoria Vyvyan said: “The impact of the government’s inheritance tax changes is casting a long shadow over the future of farming and family businesses. 

“In response to a CLA Freedom of Information request about the research into the ‘clawback option’, the Treasury says it is not in the public interest to explain itself.  We disagree – we think it is very much in the public interest to know what data they used and how. 

“Our ask is clear. If, as the exchequer secretary has said, the clawback alternative would raise ‘much less’ than the Treasury’s reforms – show us.” 

‘Autocratic and opaque policy’

Ms Vyvyan added that there has been no consultation, no impact assessment published and now no details given to support their claim that the clawback would raise less money than the proposed approach.  

“The businesses affected deserve an accountable and transparent Treasury and this policy has been tainted from the start with being autocratic, and opaque,” she concluded. 

Responding to the CLA’s FOI request, the Treasury said there is a “strong public interest in protecting information where release would be likely to have a detrimental impact on the ongoing development of policy”.  

It said the requested information “relates to a broader policy to be included in future legislation, which is yet to be finalised, published in draft, or receive Royal Assent, so this area is still subject to scrutiny”.  

This is despite ministers, including the prime minister, repeatedly stating in Parliament that the policy is final and will not change.  

The CLA and other industry bodies presented the clawback option to Mr Murray and Farming Minister Daniel Zeichner in February, after the chancellor invited alternative ways to raise revenue. 

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‘Devastating impact on the economy’

From April 2026 the government will cap vital inheritance tax reliefs for farms and family businesses.  

The clawback mechanism proposed retaining 100% agricultural and business property reliefs (APR and BPR), but inheritance tax would be applied to assets if sold within a certain time period post-death, payable out of the proceeds of sale.  

It would mean those who continue to farm would not be hit with crippling tax bills, and those who decide to sell would have the cash in the bank and be able to pay. 

The CLA expects this could generate a similar figure to what the government claims its own policy would achieve and has called on the government to ask the Office for Budget Responsibility to model the proposal. 

The CLA has argued that the government’s cap could affect 70,000 UK farms, some as small as 100 acres. It will also have a detrimental impact on farm profitability, with an average 350-acre English arable farm owned by a couple needing to spend 99% of their yearly profit over a decade to afford their inheritance tax bill. 

The changes will have a devastating impact on the economy, with CBI Economics recently estimating it will cost over 200,000 jobs during this Parliament and produce a loss of £1.9 billion in revenue for the Treasury, CLA confirmed. 

READ MORE: Government urged to delay IHT changes until 2027

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