Up to 700 farm shops could permanently close putting thousands of jobs at risk

Hundreds of farm shops could be forced to close because owners say they are feeling the impact of the budget.

Up to 700 could shut their doors over the next decade, the Farm Retail Association (FRA) warns, while farmers continue to face an uphill battle against the government.

This includes fighting against the rise to employers’ National Insurance, as well as an end to inheritance tax reliefs for farms worth more than £1million from 2026.

In response, the FRA is warning farm shops are being ‘hit from both ends’ because of the budget.

But the government has vowed its commitment to farmers and their interests remains ‘steadfast’.

Emma Mosey, the chairman of the FRA and owner of Minskip Farm Shop, told The Telegraph: ‘We’re facing the inheritance tax changes, which, as with other farms, will mean essentially selling off 20% of assets every generation to pay those extra taxes.

‘But we’ve also got the business side as well because we’re employing people in stores and that is going to cost more.’

With the loss of up to 700 stores, this means job losses as well for the people who work in farm shops up and down the UK.

The British Retail Consortium has warned that the budget added £7billion to retailers’ costs.

Sean McCann, a chartered financial planner at NFU Mutual, said: ‘As a result of the £1million cap on agricultural property relief and business property relief combined, many farming families will face substantial tax bills, which could endanger many farm shops.’

For many farmers, he said they had ‘diversified to improve profitability, and farm shops are a common way of doing that’.

But Chancellor Rachel Reeves is sticking by her budget, which she hopes will achieve ‘growth’ for the UK.

A government spokesperson said: ‘Our commitment to farmers remains steadfast – we have committed £5billion to the farming budget over two years, including more money than ever for sustainable food production, and we are developing a 25-year farming roadmap, focusing on how to make the sector more profitable in the decades to come.

‘Our reforms to Agricultural and Business Property Reliefs will mean estates will pay a reduced effective inheritance tax rate of 20%, rather than standard 40%, and payments can be spread over 10 years, interest-free.

‘This is a fair and balanced approach, which fixes the public services we all rely on, affecting around 500 estates next year.’

Many farmers have been left unhappy by the news and various protests were staged after the budget announcement.

Farmers and tractors descended into London in December to protest against the changes to inheritance tax.

Around 1,800 National Farmers’ Union (NFU) members – three times as many as originally planned, also took part in a protest in the capital in November.

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