Clan chief calls to stop farm tax as barley prices drop by almost a third

Hector Munro of Foulis, the current Clan Munro chief, owns an arable farm near Evanton in the Highlands. The business is part of Highland Grain, a cooperative of 75 farms in the Highlands that supplies malting barley to the whisky industry.

Ahead of next week’s budget, the clan chief said he has been left “deeply alarmed” by the changes to the Agriculture Property Relief (APR) as barley prices have dropped by almost a third in just three years.

The fiscal changes are due to come into effect from April 2026 when a 20 per cent tax on farms valued over £1 million will be brought in.

Rural experts said the move could impact tens of thousands of farms of varying sizes given how quickly the cost of a few acres, machinery and property can add up to on a farm. Meanwhile, UK ministers claim the changes will only impact around 500 wealthy estates each year.

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Mr Munro said it was remembering former relatives on Armistice Day and receiving the cost of grain for the latest harvest this month that prompted him to speak out against the tax changes.

“At our village Remembrance Sunday Service, I read the names on our War Memorial — including my great uncle — and reflected on the long tradition of service in rural communities like ours,” he told The Scotsman.

“Days later, I received the final price for our grain harvest, a stark reminder of the pressures currently facing farming.

“At a time when arable incomes are falling and farmers are already grappling with rising costs, climate pressures, and land reform, this change poses a severe threat to family farms across the country.”

Mr Munro said the gross price of malting barley — which his farm has produced for the Scotch whisky industry for over 240 years — has dropped from £252.56 per tonne in 2023 to £181.63 in 2025, a fall in income of 28 per cent in three years.

With the current downturn in the distilling industry, the clan chief said “there is worse to come.”

“Farms are typically asset-rich but cash-poor,” he said.

“Removing APR without consultation risks forcing families to sell productive land simply to meet tax demands, undermining rural economies and the wider food and drink supply chain.

“I urge elected representatives to press for an immediate review of this policy before long-established family farms — like ours — become unsustainable.”

Mr Munro, whose son works with him on the family farm and who will take it on, said he believes the tax changes will lead to a downturn in the rural economy and break up the passing on of traditional skills and knowledge of the land.

“I understand the changes for the people who are using the current taxation laws to hide their fortunes,” he said.

“But, unfortunately, it's hitting all the family farms as well. We risk losing the skills and deep knowledge that are being passed on from generation to generation.”

Wearing his clan chief hat, Mr Munro also has responsibilities to support the historic Foulis Castle, the ancestral home to the chiefs of Clan Munro, and which is located on land the family has had connection to for the last 675 years.

He said the attraction draws international visitors, adding: “This year for one week we hosted 150 plus Americans, Canadian and French Munros, besides numerous individual visitors throughout the year and all this whilst doing the day job.

“If, as rumoured, Rachel Reeves inflicts a mansion tax upon us in the budget later this month, that will be the final straw.”

A Defra spokesperson said: “Farmers are stewards for our nation's land and for our food security. Farming also plays a central role in our mission to kickstart economic growth.

“That is why we are backing them through new technology, streamlined regulation and our nature-friendly farming schemes that are helping farmers produce food for the nation

“Our reforms to Agricultural and Business Property Relief are vital to fix the public services we all rely on.”