TODAY’S BUDGET RESPONDS TO IFA FARM INCOME CAMPAIGN – HEALY

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TODAY’S BUDGET RESPONDS TO IFA FARM INCOME CAMPAIGN - HEALY
11 Oct 2016

TODAY’S BUDGET RESPONDS TO IFA FARM INCOME CAMPAIGN – HEALY

Economics, Farm Business & Credit, Rural Development

IFA President Joe Healy said today’s Budget has responded positively to IFA’s farm income campaign over the last six months with significant measures on low-cost loans, increased funding for farm schemes, the reversal of cuts to Farm Assist and flexibility on income averaging to help deal with volatility.

Joe Healy said 2016 has been a very difficult year for farm families with low commodity prices, poor weather conditions and the impact of the Brexit decision.

The IFA President welcomed the introduction of a new €150m agri cashflow support loan fund, at an interest rate of 2.95%, which is to be available to farmers in all sectors.

The IFA President also acknowledged the €107m increase in funding of farm schemes under the Rural Development Programme (RDP), in particular the €69m increase for GLAS to €211m for 50,000 farmers, the new €25m sheep welfare scheme and the re-opening of the Beef Genomics Programme, with funding of €52m for next year. “The Government must build on these schemes to reach the €250m target for GLAS set out in the RDP and continue to improve suckler and sheep supports.” Funding of €50m for TAMS, €111.6m for forestry and €5m for horticulture have also been confirmed.

However, he said the decision not to start the restoration of ANC funding in 2017 was disappointing, given the very difficult income situation this year.

Joe Healy said the new flexibility under income averaging, to be introduced for the current year, will allow farmers to opt out in an exceptional year. This will help farmers to manage the very difficult cashflow situation on farms this year.

Mr Healy particularly welcomed the reversal of cuts to Farm Assist, along with the €5 per week increase, and the provision for 500 extra places under the Rural Social Scheme. Both are vital supports for low-income farm families.

Taxation

Joe Healy said, “The decision to increase the Earned Income Tax Credit by only €400 to €950 falls short of the €1,650 PAYE allowance and this must be reached in next year’s Budget to remove discrimination against farmers and the self-employed”.

He noted the excise rate on agri-diesel and all road fuels remains unchanged, reflecting the importance of maintaining our cost competitiveness in the aftermath of Brexit.

The flat rate VAT refund has been increased to 5.4% from January 1st. This is worth €9m.

IFA acknowledged the following measures to support farm consolidation and investment:

  • farm restructuring relief from CGT has been extended to the end of 2019;
  • CGT rate for disposal of business assets up to €1m has been reduced from 20% to 10%;
  • The SEAI scheme for accelerated capital allowances for investment in energy efficient equipment has been extended to sole traders.

 

Read more about the taxation changes introduced in Budget 2017 

Read more about the expenditure measures introduced in Budget 2017

Download a Summary Report on Budget 2017

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