Six EU countries end direct aid payments above €150,000
According to the Agra Europe information agency, most member states are only applying a 5% “degressivity” tax on CAP direct payment amounts over €150 000.
In Ireland, about 45 farmers were getting an annual single farm payment of more than €150,000, up to this year (including 13 over €200,000).
The 100% cap will also be applied in Northern Ireland, Belgium (excluding the Wallonia region), Greece, Austria and Poland.
A higher 100% cut-off point has been chosen in five countries. Hungary has opted for €176,000, Bulgaria for €300,000, Wales for €300,000, Italy for €500,000, and Scotland for €600,000.
Wales has opted for a 15% “degressivity” tax on amounts over €150,000; 30% over €200,000; and 55% over €250,000. Italy has opted for a 50% “degressivity” tax on amounts over €150,000.
Degressivity is compulsory — unless member states apply a ‘redistributive’ payment, whereby at least 5% of their direct payments envelope is withheld, and redistributed on the ‘first’ hectares of all farms.
Of the 28 member states, 15 will only apply the minimum 5% degressivity tax, while eight are applying the redistributive payment.
Bulgaria and Romania are the only two to apply both.
In the CAP reform negotiations, there was strong opposition to capping from countries with large-scale farms, but the European Parliament and Commission insisted on some reduction to the biggest subsidies.
With a 5% degressivity tax on amounts over €150,000, a landowner receiving €300,000 will be “taxed” €3,000 (the 30% ‘greening’ payment is exempt, and of the remaining €210,000, there is €60,000 taxable, and 5% of that is €3,000.
A landowner receiving €200,000 does not lose anything, because only €140,000 is left when the 30% greening part is deducted.
The funds released by “capping” of payments stay with each member state, and will be recycled to rural development programmes, without any need for co-financing.
