The announcement of capital allowances for the construction of slurry storage facilities and a 10% concrete levy in the same budget is sending farmers “mixed messages”, one farm organisation has said.
President of the Irish Creamery Milk Supplier’s Association (ICMSA) Pat McCormack has said that the accelerated capital allowances included in the budget yesterday (Tuesday, September 27), would have given momentum to farmers trying to make environmental improvements.
However, he added that the decision to introduce a 10% levy on the kind of concrete products that would be used in this type of construction effectively negates the benefits of the measure.
“It’s already obvious that the combination of both these measures is going to end up with them cancelling each other out,” he said.
The organisation has now called for on-farm environmental improvement projects to be exempt from the levy as the construction of these structures will be “impossible” if not.
McCormack said that “there wouldn’t be any serious objection” to this exemption, as it is widely recognised that environmental improvements on farms are absolutely necessary to meet a 25% reduction in agri-emissions.
The levy, which will be introduced to raise money for the mica redress scheme, is set to come into effect on April 3, 2023. It is expected to raise approximately €80 million annually.
McCormack called for the government to recognise the “obvious difference” between general construction and the construction of farm buildings specifically for environmental protection purposes.
“We have the government effectively forcing farmers to build greater slurry storage capacity and we have farmers ready to do that but hampered by rampant construction inflation and a shortage of contractors,” he said.
“Now, we have the government effectively putting 10% on the costs of that slurry storage construction through the mica levy and that’s going to mean a drastic slowing down of this work, if not an outright stop.
“We think that the government should certainly revisit this and get their policy ducks in a row,” he concluded.