Budget Reports

Cross Sectors
Budget Reports

IFA Budget Reports

IFA Budget reports provide IFA members with a summary of the main decisions affecting agriculture and farm families in each Budget.

The reports provide an overview of changes in government expenditure in relation to agriculture; relevant taxation and social welfare measures; and public finances and national economy.

The continued strong growth rate in the Irish economy in 2016 of 4.2% and a positive outlook for 2017 enabled the Government to deliver a budget with an increased resource allocation of €1.3b. This comprised a net reduction in taxation of €300m and an increase in expenditure of €1b above existing commitments.

Agriculture Budget

The Agricultural Budget has increased from €1.35b to €1.47b, an increase of 9%. Expenditure on farm schemes under the Rural Development Programme has increased from €494m in 2016 to €601m in 2017.

Current expenditure

Agri-environment measures
€242m has been allocated for the Agri-environment schemes (GLAS / AEOS/Organic). This includes a funding allocation of €211m for GLAS for payment of up to 50,000 farmers.

Sheep Welfare Scheme
 €25m has been allocated for a new animal welfare scheme at a rate of €10/ewe.

Areas of Natural Constraint
There is no change to payment levels for Areas of Natural Constraint. A funding allocation of €202m is provided for 2017.

Beef Data and Genomics programme
€52m has been allocated for 2017 and the scheme will be re-opened to new applicants.

Knowledge Transfer
Funding of €26m for Knowledge Transfer programmes for 2017.

Food Safety Animal Health & Welfare
Total funding allocated is €85.5m under this heading, which includes €34m for TB and Brucellosis eradication.

Low Cost Loan Fund
A €150m loan fund, which will offer rates below 3%, has been established. This will provide funds to farmers for cash-flow purposes and to the cost of short term borrowing.

Capital expenditure

€50m has been allocated for this programme in 2017.

€111.6m has been allocated for forestry.

€5m has been provided for capital investment in the horticulture sector.

Social Protection

Farm Assist
The cuts introduced in the 2012 and 2013 budgets have been fully reversed – i.e. child and income disregards have been reintroduced. The weekly payment will be increased by €5 a week and by €3.30 for dependent adults.

Rural Social Scheme
There is an increase of 500 in the number of places for this scheme, bringing the total number to 3,100.

State Pension
This will increase by €5 per week in March 2017.

Other allowances
All weekly social welfare payments will increase by €5 in March 2017 (Carers, Jobseekers, Disability Allowance and Farm Assist).

Arts, Heritage, Regional, Rural and Gaeltacht Affairs

€40m funding is being allocated for the delivery of the LEADER Rural Development programme in 2017.

Town and village regeneration scheme
€12m has been allocated for this scheme, with a €5m increase for the CLAR scheme.


Prescription charges
The cap on prescription charges will be reduced to €20 for over 70 year olds from 1st March 2017.

Medical cards for children
Medical cards will be extended to all children in receipt of a Domiciliary Care Allowance.

Children and Youth Affairs
Affordable Childcare Scheme: A new scheme will be introduced from September 2017, this will provide a means tested subsidy for children between 6 months and 15 years (for households earning up to €47,500 net income), and a universal subsidy for all children aged between 6 months and 3 years (up to €900 per annum).

Agricultural taxation

Income Averaging
Farmers on income averaging will now be allowed, in a very poor income year, to pay only the tax due on the current year. The deferred tax liability will be payable over subsequent years. This measure will be available immediately.

CGT Relief for Farm Restructuring
Extended to end 31st December 2019.

Accelerated Capital Allowances for Energy Efficient Investment
This measure has been extended to sole traders and provides full capital allowance in the first year.

VAT refund
Increased from 5.2% to 5.4% from 1st January 2017 and is worth €9m.

Capital Acquisitions Tax – Agricultural Relief
Retained at 90%. The increase in the Group thresholds for exemption from CAT will increase the value of farm that can be transferred through Agricultural Relief.

Raised Bog CGT Relief
Payments under the Raised Bog Restoration Incentive scheme will be exempt from Capital Gains Tax.

General Taxation Measures

Earned Income Tax credit
For self-employed tax payers, including farmers, who do not receive the PAYE Tax Credit, the Earned Income Tax Credit of €550 is being increased by a further €400 to €950.

Universal Social charge
The rates of USC are being reduced as follows:
– The lowest rate of 1% is to be reduced to 0.5%; this applies to the first €12,012 of income.
– The 3% rate is to be reduced to 2.5%; this applies on income from €12,013 to €18,772.
– The 5.5% rate is to fall to 5%; this applies to income between €18,773 up to €70,044.

Other Income Tax changes

H0me Carer Credit
The Home Carer tax credit is being increased by €100 to €1,100.

Invalidity Pension: Eligibility for the Invalidity Pension is being extended to the self-employed, including farmers.

The rate of DIRT tax is being reduced from 41% to 39%. The Government’s intention is to reduce this further by 2% / year to reach 33% by 2020.

Capital Acquisitions Tax
The Group A (parent to child) CAT threshold is being increased from €280,000 to €310,000. The Group B threshold (brother, sister, niece, nephew, grandchild) is being increased from €30,150 to €32,500. The Group C threshold (all others) is being increased from €15,075 to €16,250.

CGT Entrepreneur Relief
The rate of CGT on the sale of business is reduced from 20% to 10%, for disposals of value up to €1m on qualifying chargeable gains.

Carbon Tax
Relief from Carbon Tax is provided for solid fuels that include a biomass element and for fuel inputs to combined heat and power plants (CHP).

Help to Buy
A new income tax rebate for first time buyers of new houses is being introduced, providing a maximum rebate of €20,000.

Economic growth (GDP)
GDP growth of 4.2% in 2016 with projected growth of 3.5% in 2017.

Government deficit
The projected deficit for 2016 is 0.9% of GDP, falling to 0.4% in 2017.

Government debt
GDP ratio: This is projected to reach 76% of GDP by end 2016. The Government has set a target of 45% of GDP by the middle of the next decade.

Unemployment rate
Continues to fall and is projected to be 7.7% by 2017.

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