The Kerryman (South Kerry Edition)
What farmers need in the upcoming Budget
KERRY IFA Chairman Patrick O’Driscoll outlines the key measures IFA is seeking in Budget 2018 for farm families
The Government has billed the forthcoming budget as a ‘Brexit’ budget. As agriculture is the sector that will be - and has been - most impacted by the effect of Brexit, IFA is clear that the Budget has to contain strong and practical measures that will support farm incomes and improve competitiveness in our sector.
We have met with Taoiseach Leo Varadkar, and with Minister for Finance Paschal Donohoe to spell out that message. We have also met with TDs and senators from all over the country, including here locally in Kerry, to press the case for the measures we have identified that will improve farm incomes and provide support to farmers in the context of the sterling weakness.
A chief priority for IFA is for Government to build on the success the €150m low-cost loan fund we secured in last year’s Budget. The interest in last year’s scheme is strong evidence that farmers need access to low cost bank financing and Government must respond to this by providing government-supported low-cost loans for farming enterprises, to fund both ongoing working capital requirements and on-farm investment
Farm scheme payments are a vital support to farmers across the country. IFA is campaigning for increased funding for the Areas of Natural Constraint to reach €225m, commencing the process of restoring ANC payments to 2008 levels. Government must also seek direct support at EU level for farm level measures that counteract the price drops in the sectors impacted by sterling weakness, in particular the beef sector.
Increased direct payments are essential to maintain our national suckler cow herd, the backbone of the €2.5bn Irish beef sector. IFA is pushing for a €50 per head increase in suckler supports needed in response to the Brexit and Mercosur challenge on beef. IFA has put detailed proposals to Minister Creed and the Department to increase the suckler support by €25m through a €50 per cow bolt-on to the BDGP scheme for animal welfare.
Alongside expenditure measures, taxation changes are required to address income volatility, the discrimination between self-employed and employees in the income tax system, and to support intergenerational transfer and farm restructuring.
The key priorities we have identified for farm taxation in Budget 2018 are:
Income volatility – extension of income averaging where farmer/spouse has additional self-employed income, greater flexibility on ‘step-out’, and provision of a deposit scheme
Earned Income Tax Credit to be increased to the same level as the PAYE credit Retention of consanguinity relief for stamp duty, and extension of relief to all transfers undertaken within Registered Farm Partnership structure Farmland under solar panel infrastructure to be classified as a qualifying asset for the purpose of assessment for relief from Capital Acquisitions Tax upon transfer
Reduction in the VAT rate on animal vaccines as a means to improve herd health.
Delivery on IFA’s budget proposals will contribute to tackling low farm incomes, underpinning the contribution of the farming and agri-food sector to the economy, including the Foodwise 2025 targets, and supporting economic activity in rural communities.
Fair Deal Scheme
An increase in funding for the Fair Deal Scheme to remove the discrimination against farming and other small business assets in the means assessment is also among IFA’s Budget proposals.
At a recent meeting with the IFA, Minister for Older People, Jim Daly gave a commitment to introduce a change to the Fair Deal scheme that would mean a three year cap on the time a charge on productive farm assets would apply. This change is subject to the approval of the Attorney General and the Cabinet.
Changes to the scheme are long overdue and the removal of uncapped liability on farm assets would go some way to ad- dressing the concerns of farm families and to providing some certainty for farm families, however it is important that this is implemented quickly and IFA will be meeting with the Minister to pursue speedy implementation and to discuss the changes in detail. Details of the Budget 2018 measures for agriculture and farm families on the IFA Website on Budget Day, October 10th – www.ifa.ie.