Speaking at the National Economic Dialogue today, IFA President Tim Cullinan said Government policy will have to reflect the changed circumstances over the last six months.
He said the war in Ukraine had caused huge disruption and farm families were struggling with extra bills.
“Farmers are currently engulfed in an inputs price crisis, and they will need innovative financial supports to help preserve food supply, employment and economic activity in rural Ireland in the weeks and months ahead. While we acknowledge the pigs, tillage and fodder schemes, more will need to be done,” he said.
The IFA President said the Government’s climate policy has to incorporate economic and social sustainability.
“This must be the cornerstone of policy formation. We cannot have environmental targets without a proper understanding of the implications for economic and social sustainability. As we face economic headwinds, this principle must apply right across the economy, not just in agriculture,” he said.
The Government must ensure that all the provisions in the Climate Act in relation to farming are properly taken into account when setting sectoral emissions ceilings.
The ceiling based on a 21.7% reduction will pose huge challenges. However, anything higher will do significant damage on top of the renewed Brexit uncertainty the sector faces.
Tim Cullinan said Budget 2023 provides a real opportunity for this Government to demonstrate that they understand the real situation for Irish farmers on the ground.
“I am calling on the Government to firstly remove all unnecessary uncertainty and, at a minimum, extend all existing positive taxation measures/interventions to promote agricultural activity; asset transfer and balanced rural development for at least the next three years.”
“Maximum co-financing under the CAP and securing maximum BAR funding for Irish farmers would help to combat the current input crisis, but also the significant cuts in the Basic Payments that many will encounter in 2023 as the new CAP Programme begins,” he said.
Tim Cullinan also proposed a temporary reduction in the VAT rate for select agri commodities; suspension of excise duty on agri-diesel & LPG for farm use to help reduce production costs at farm level.
VAT exemptions and accelerated capital allowances would further support increased investment and adoption of more environmentally friendly practices. This would support climate change ambitions of carbon neutrality by 2050.
The Zoned Residential Land Tax, introduced in the Finance Bill 2022 and to be implemented from January 2024 must ensure that all productive farmland currently and previously used for food production purposes is exempted.