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IFA Farm Business Chair Rose Mary McDonagh has identified some key priorities following the recent publication of “The Farming Sector in Ireland: A Profile from Revenue Data” by The Office of the Revenue Commissioners.

“The report highlights the struggle of generational renewal. 37% of farmers are aged over 60, while only 24% of farmers are under 40. However, the report also points out the value that tax reliefs provide to incentivise transfer and succession,” she said. (see table below)

Rose Mary McDonagh said agriculture is a low-margin, highly capital-intensive business which requires investment in its primary asset – land, and the reliefs are imperative for greater land mobility and to encourage land transfer. Along with reliefs under the stamp duty code and Young Trained Farmer reliefs, they are vital to the sustainability and viability of the agricultural sector. Moreover, they align with one of the nine objectives of the CAP – generational renewal.

“In 2018, Capital Gains Tax Retirement Relief was worth, on average, €355,795 to each claimant. On average, between 2014 and 2019, Capital Acquisitions Tax Agricultural Relief has been worth €104,492 to each claimant. The Succession Farm Partnership Credit was introduced in 2017 and there was a 66% increase in the number of those who availed of the relief in 2018.”

“In 2019, Consanguinity relief from Stamp Duty on non-residential transfers was worth, on average, €17,009 per claimant. In addition, there has been a 58% rise in the number of Young Trained Farmers claiming relief from Stamp Duty between 2013 and 2019.”

The Farm Business Chairman emphasised the importance and critical nature of these reliefs to the agricultural sector in order to encourage farm transfer.

The report provides a snapshot of farm incomes, farmer age profiles, the uptake of tax reliefs, and the incidence of farm transfers and succession.

At farm level, Average Farming Income in 2018 was €20,886 and Average Gross Income was €47,029.

The report underlines that average farm incomes are below the industrial average and must be supplemented with off-farm employment.

 

Relief/Credit Year No. of claimants
Succession Farm Partnership Credit 2018 290
Capital Gains Tax Retirement Relief 2018 322 within families

420 outside of families

Capital Acquisitions Tax Agri Relief 2018 1,413
Young Trained Farm Stamp Duty Relief 2019 1,128
Consanguinity relief for Stamp Duty on non-residential transfers 2019 1,605

 

 

Ends.

 

Contact:

Niall Madigan                (01) 450 1931/ 086 822 8635

Ethel Horan                   (01) 426 0344/ 087 910 4111

Launching IFA’s pre-Budget 2021 submission, IFA President Tim Cullinan said that farm schemes, Brexit supports and a carbon tax exemption for agri-diesel were the critical elements of IFA’s pre-Budget submission.

“We have targets for all of the agri-schemes including; seeking payment of €300 per suckler cow, €30 per ewe and €300m for ANCs,” he said.

“The Government must acknowledge the imminent threat of Brexit. In 2019 €110m was set aside for a Brexit reserve. This fund must increase in Budget 2021. The €5bn contingency fund at EU level is essential, but we need our Government to be willing to help farmers too,” he said.

On carbon tax,  IFA is calling for an exception for agri-diesel.

“The purpose of the carbon tax is to change behaviour, but, farmers do not have an alternative to fossil-fuelled tractors. There should be an exemption from carbon tax on agri-diesel until alternatives become available,” said the IFA President.

“Stamp duty reliefs, specifically consanguinity and consolidation relief, are due to be renewed this year – it is vital that this happens to encourage farm transfer and generational renewal,” he said.

IFA Farm Business Committee Chair Rose Mary McDonagh said, “In our pre-Budget submission, IFA put forward proposals based on the three pillars of sustainability: economic, environmental and social. Our message to Government between now and October is that the sustainable growth of our sector needs policies that encourage investment at farm level, recognise the role of agriculture in achieving balanced regional development and deliver viable farm incomes “.

“There is a significant need for taxation supports, in particular through investment in emissions efficient equipment and the removal of discrimination in our tax system for the self-employed.”

IFA Rural Development Chairman Michael Biggins said farm schemes must remain a central part of Government policy, particularly for the low-income dry stock sector.

“Direct payments are a huge part of family farm incomes. Targeted schemes are increasingly important, many of which have a significant climate action element,” he said.

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