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IFA Budget 2021 report available here.

Reacting to the Budget, IFA President Tim Cullinan acknowledged the renewal of essential tax reliefs and the equalisation of the self-employed tax credit with the PAYE credit and the continued funding of farm schemes.

“We fully accept the challenges facing the State from COVID-19, but we have a further emergency coming in the form of Brexit,” he said.

This Budget needed to give more acknowledge to the imminent threat of Brexit. In 2019 €110m was set aside for a Brexit reserve. We need immediate clarity on the status of this fund and what precisely has been set aside for Brexit. We cannot rely on the EU contingency fund alone,” he said.

 

“One announcement that could also be significant is funding to establish a new Food Ombudsman. However, this must cover the entire food chain and have real teeth” he said.

“The pilot agri-environment schemes will require consultation; however, we need to be clear that carbon tax will impact disproportionately on farmers. The increase in the Carbon Tax will increase the burden on farmers by an extra €6m bringing the total annual cost to over €25m with no alternatives available,” he said.

Taxation measures

The Chair of IFA’s Farm Business Committee Rosemary McDonagh said, “It is positive to see stamp duty reliefs, specifically consanguinity and consolidation relief, renewed in the Budget. These will encourage farm transfer and generational renewal”.

“The equalisation of the Earned Income Tax Credit by €150 to €1,650 is long overdue, but welcome, as is the increase in the flat rate on VAT from 5.4% to 5.6%,” she said.

Farm Schemes

“It is positive to see an allocation for the rollover of farm schemes as part of the CAP transition including GLAS, ANC, TAMS, suckler cow (BDGP & BEEP-S), sheep welfare, and organics,” said IFA Rural Development Chairman Michael Biggins.

“Farm schemes must remain a central part of Government policy, particularly for the low-income dry stock sector,” he said.

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

 

 

IFA President Tim Cullinan held an online meeting with the Minister for Finance Paschal Donohoe, the Minister for Public Expenditure Michael McGrath and the Minister of State at the Dept of Finance Patrick O’Donovan today to discuss our pre-Budget submission.

“While we fully understand that challenges facing the exchequer arising from COVID-19, the shadow of Brexit is creating massive uncertainty for farmers. Government support for the sector was never more important,” he said.

“While a €5bn contingency fund has been set aside at EU level, our Government will have to step up to the plate also,” he said.

“We are facing at least a one-year CAP transition, and the funding for farm schemes will have to be maintained. They are a vital part of farm incomes, and they also underpin investment in the sector,” he said.

“Investment in farming gives a real return to the rural economy, and we believe farmers and the agricultural sector can play a major part in the economic recovery,” he said.

The Chair of the Farm Business Committee Rose Mary McDonagh and the Chairman of the Rural Development Committee Michael Biggins also attended the meeting.

Rosemary McDonagh said the delegation also raised the importance of the range of reliefs.

“The renewal of consolidation and consanguinity Stamp Duty reliefs are crucial to encourage generational renewal. Both of these need to be renewed this year, and we need the PAYE self-employed allowance equalised fully,” she said.

“All the tax reliefs for agriculture must remain in place,” she said.

IFA Rural Development Chairman Michael Biggins said that farmers need certainty concerning vital farm schemes.

“A lot of these schemes have an environmental component and are critical supports for farm incomes. We need a clear commitment from Government that these schemes will be maintained during the CAP transition phase, whether that lasts for one or two years,” he said.

IFA also had the opportunity to raise the importance of an adequate budget to fund the proposed three-year cap on the Fair Deal Scheme, amongst other issues in our pre-Budget submission.

 

 

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.

As part of IFA’s campaign, officers will meet TDs & Senators in the coming weeks at a local level. On Wednesday 16th September, IFA will hold its national lobbying day while adhering to all national guidelines regarding Covid-19.

IFA President Tim Cullinan yesterday led an IFA delegation to meet the new Agriculture Minister Dara Calleary.

“It was an opportunity for us to discuss the outcome of the CAP talks and while the allocation for Pillar 1 is down, there are still some technical issues to decide which could avoid a cut in the 2021 BPS. The Minister and his officials must do all they can to avoid any cut BPS,” he said.

“The other important issue is the level of national co-financing for schemes such as the BDGP, Sheep Welfare, GLAS and TAMS. The maximum level of permissible co-financing has expanded to 57%. The Irish Government must commit to the maximum co-financing,” he said.

“Farm schemes must target active farmers and issues like the unfair burden of designated land must be addressed,” he said.

“I also made it clear to Minister Calleary that the €50m COVID support scheme for beef must give significant support to the finishers who lost the most as a result of the COVID crisis. A scattergun approach to distributing this fund would be a lost opportunity,” he said.

“The looming threat of Brexit was also discussed. The €5bn EU contingency fund is a significant development, but we also need to strengthen the €110m Brexit reserve for agriculture introduced in the last Budget,” he said.

“We were clear that IFA intends to engage constructively on the commitments in the Programme for Government on climate action and diversity,” he said.

“However, we emphasised the importance of productive agriculture and the need to secure the continuation of the nitrates derogation,” he said.

“The new Food Ombudsman must have real power and be sufficiently resourced,” he said.

Other issues discussed included tillage, renewables, forestry, Fair Deal, aquaculture and the recent landslide in Leitrim.

IFA President Tim Cullinan has congratulated the new Minister for Agriculture Dara Calleary on his appointment.

“We look forward to working with the new Minister to ensure that we harness the full potential of our farming sector,” he said.

“It is important that the new Minister hits the ground running,” he said.

The IFA President said, “The EU Council on Friday and Saturday where the EU and CAP budgets for the next seven years will be discussed is absolutely critical for Irish farming. It is vital that the new Minister stresses the importance of this to the Taoiseach who will be representing Ireland at the meeting,” he said.

“We also need to get the €50m COVID beef payment out to farmers as a matter of urgency,” he said.

“I also want to wish former Minister Cowen and his family all the best for the future.”


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