Rachel Reeves has doubled down on treasury claims that a ‘very small number’ of farms while be impacted by budgetary reforms to inheritance taxes.

Following the decision to introduce death duties to landowners at last weeks budget Ms Reeves has faced further scrutiny from the industry, as concerns mount it could jeopardise the future of family farms.

The first £1m of combined business and agricultural assets will remain inheritance tax free. However, for assets exceeding this value, inheritance tax will apply with a 50% relief, resulting in an effective rate of 20%.

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While appearing on BBC’s Sunday with Laura Kuenssberg, Ms Reeves was questioned by Rebecca Wilson, a fifth-gen farmer from Yorkshire.

In the clip Ms Wilson said: ‘Even using personal allowances, the chancellor’s proposal could hit us with a tax bill of nearly £1m when my parents die.

‘How is the chancellor going to ensure my generation will keep on farming in light of the changes announced in the Budget?’

Ms Reeves reinforced her claim that only a ‘small number of farms’ would be affected by the reform and that in ‘most cases’ farms valued up to £3m could be be transferred without paying tax.

Continuing, Ms Reeves stated: “After that the tax rate for inheritance tax for agricultural property is 20% compared to 40% that everyone else pays, and you can pay that over a ten-year period interest-free.

“I don’t think it is affordable to carry on with a relief like that when our public finances are under so much pressure.”

Scottish Conservative shadow cabinet secretary for rural affairs Tim Eagle, a former land agent and farmer, said this new tax “is a further hammer blow for farmers across Scotland.”

He said: “These significant changes make it clear Labour are not interested in supporting the sector and that they are completely detached from recognising the deeply damaging impact this will have on farmers.

“Labour should urgently u-turn and ensure that this vital relief is restored. Otherwise, it could spell the end for the family farm.”

The government contest that only 27% of farms in the UK will be affected by the change to inheritance tax, however, former NFU president Baroness Batters suggested this figure would be closer to 70%.

Speaking on Times Radio Baroness Batters stated that family farms are “cash poor” and “asset rich” and to settle such high levels of inheritance tax would be forced to sell off land.

She said: “I think this is where we absolutely have to see the analysis of how they’ve done this. I don’t think they’ve separated tenants out.

“I’m a tenant farmer, 50% of farmers in this country are tenants, they are often farming land that is owned by large landowners or institutional landowners like the National Trust, or the Crown Estates.”

Baroness Batters suggested that the governments figures could be skewed by the inclusion of so-called lifestyle farmers “that don’t produce significant amounts of food.”

Writing in the Mail on Sunday she continued stating: “Such small parcels of land are often bought by city folk looking for an exciting new vocation... Remove these “lifestyle” farms from the equation and those figures will flip.”