Farming bodies stress tax review must drive agri production
The agri-taxation review by the Department of Finance and the Department of Agriculture must positively incentivise agricultural production at farm level and also support the viability and sustainability of the family farm.
This is according to Irish Farmers Association (IFA) president Eddie Downey. “If these same aims are not prioritised, Government targets under Food Harvest 2020 will not be met,” he cautioned.
The tax review, which opened to a consultation process yesterday, has two main objectives; holding what the farm reliefs are there at present, and pushing for new measures that address farm investment, land mobility, income volatility and succession.
The first meeting of the IFA Farm Taxation Project Team will take place this week and the Minister for Finance, Michael Noonan, is set to attend the IFA executive council on Friday, 21 February.
“This will be an opportunity for the minister to hear from our members about the important role that existing measures play in the farming sector, and what is needed to underpin the expansion plans and deal with volatility,” the IFA president added.
According to the IFA, it has three priorities in the agri-taxation review: to ensure that valuable tax reliefs, which are critical to the development and growth of the agri sector, are maintained; to secure new tax incentives that are necessary to drive structural improvements by incentivising land transfer, mobility and investment and; to fully examine how the taxation system can better accommodate the extreme volatility in farm incomes.
The IFA will be making a detailed submission as part of the agri-taxation review.
Meanwhile the ICMSA welcomed the consultation period for agri-taxation review. Commenting on its commencement, the president of ICMSA, John Comer, said he hoped that the process will involve genuinely identifying issues with the taxation system and putting forward solutions. He said that ICMSA will be happy to participate in the review on that basis.
“Irish agriculture is facing into a period of both enormous change and challenges, and the taxation system must allow farm families to address that reality. ICMSA broadly agrees with the key policies as identified in the review, but we believe there must also be an additional focus on how the taxation system can promote ‘on-farm’ investment in a manner that will not only benefit farm families, but also the wider economy, specifically, the wider rural economy,” said Comer.
While acknowledging improvements in recent Budgets, Comer noted the taxation system remains a major barrier to positive change and he called for it to be restructured in a way that would allow farm families develop in a sustainable way.
He said the ICMSA will engage with the review in a proactive manner but would clearly resist any attempts to undermine existing tax reliefs unless acceptable alternatives were put forward.
In addition, Macra na Feirme stressed that agriculture needs a favourable agri-taxation environment in order to tackle structural challenges in the industry such as age profile of farmers and land mobility.
“Reliefs targeted at young farmers entering farming and helping young farmers get established and grow their business are vital to ensuring growth in the sector and ensuring the orderly and timely transfer to the next generation,” it added.
Macra will also make a formal submission in the agri-taxation review later this month.