A Fianna Fáil TD has questioned if cross-government measures will be introduced to "reduce the sale of farm land to non-farming interests".
The Cavan-Monaghan TD, Brendan Smith, raised the issue in a parliamentary question, where he highlighted "the need to support small farm holders who may wish to buy neighbouring farm land for farming purposes when such options arise".
Deputy Smith detailed that "non-farming interests" could include "large-scale businesses" in this instance.
However in response the Minister for Finance, Paschal Donohoe, said that he had been advised by Revenue that there are "a number of tax reliefs which support farmers who wish to acquire land for the purpose of their farming trade".
Minister Donohoe said these included reliefs from both Capital Gains Tax (CGT) and stamp duty and also pointed to the fact that measures had previously been introduced to "deter investors acquiring farmland".
In his response to Deputy Smith's parliamentary question, Minister Donohoe detailed that this measure was introduced in Finance (No. 2) Act 2023 to "deter investors acquiring farmland with a view to leasing it out and availing of an income tax relief".
"Section 664 provides relief in respect of certain income arising from the long-term leasing of farmland.
"Subject to an upper limit, individuals who qualify for the relief are entitled to take a deduction in determining their total income for income tax purposes," he added.
In order to qualify for the relief the lease must be a "qualifying lease" that is, a lease of farmland which is in writing or evidenced in writing and is for a definite term of five years or more.
It must also be made on an arm’s length basis between one or more qualifying lessors and one or more qualifying lessees, according to Revenue.
Minister Donohoe added: "In respect of farmland purchased by an individual pursuant to a contract entered into on or after January 1, 2024 for a consideration equal to the market value of the land at the date of the purchase, the purchaser will be required to hold the farmland in question for at least seven years before letting that farmland under a lease which qualifies for relief under section 664.
"Long leases of farmland are considered purchases for the purposes of the seven-year holding rule".
The minister also outlined to Deputy Smith that relief is available from CGT in relation to "gains arising on transactions undertaken to achieve farm restructuring".
"The relief applies to a sale, purchase, or exchange of agricultural land in the period from January 1, 2013 to December 31, 2025, where Teagasc has certified that the sale, purchase, or exchange of agricultural land was made for farm restructuring purposes," he added.
Minister Donohoe also said that the initial sale or purchase, or the exchange of agricultural land must occur in the period set out and the subsequent sale or purchase must occur within 24 months of that initial sale or purchase.
"Full relief from CGT will be given where the consideration for the purchase or exchange of agricultural land is equal to or exceeds the consideration for the sale or the other land that is exchanged," he said.
In order to qualify for this tax relief, an application for a farm restructuring certificate must be made to Teagasc, which in turn must grant the certificate and this certificate must then not be withdrawn.
In relation to other options the Minister for Finance said stamp duty relief applies where farm holdings are consolidated by way of linked sales and purchases of land and where land is transferred as a gift or by way of exchange, where the purchase and the sale occur within 24 months of each other.
Minister Donohoe added: "Where the relief applies, stamp duty at a reduced rate of 1% - instead of 7.5% - applies to the excess of the value of the land acquired over the value of the land disposed of.
"The relief is only available to a farmer - or in the case of joint owners, one must be a farmer - who spends not less than 50% of their normal working time farming and it is not available to non-farming interests."
However there are a several conditions which must be satisfied in order to qualify for the relief including:
"This relief applies to acquisitions and disposals of land where the instruments are executed on or after January 1, 2018.
"This relief has been extended on many occasions and is currently due to expire on December 31, 2025," the Minister for Finance stated.