The definition of an ‘active farmer’ will be re-examined by Finance Minister Michael Noonan and changed if necessary, following widespread concerns that it will greatly restrict availability of recent Budget tax measures to support farming.
The Oireachtas Joint Committee on Agriculture, Food and the Marine has written to Mr Noonan, highlighting its concerns, and Finance Minister of State, Simon Harris, has confirmed Minister Noonan will examine the ‘active farmer’ definition, which can be amended at the committee stage of the Finance Bill.
Budget measures included tax relief in transfers of non-residential property to certain relatives, if the transferee is an ‘active farmer’; no stamp duty on agricultural leases to ‘active farmers’; and improved capital acquisitions tax relief for ‘active-farmer’ beneficiaries.
But the requirement that an ‘active farmer’ must spend 50% of working time farming was not viable, was unfair and was impossible to meet, said Fine Gael TD for Kildare South, Martin Heydon, chairman of Fine Gael’s internal agriculture committee.
He said agriculture needed part-time farmers, because the alternative was ranch farming and land abandonment, largely because commodity prices are low, and farmers have to earn additional income.
He asked Minister Noonan to consider adopting the IFA proposal that an ‘active farmer’ be defined as someone who farms and files a return under schedule D.
Galway West Fine Gael TD, Sean Kyne, proposed that an ‘active farmer’ be defined according to section 655 of the Taxes Consolidation Act. Galway East Fine Gael TD, Paul Connaughton, said 50-60% of farmers were part-time, and they should not be discriminated against.
Laois Offaly Fianna Fáil TD, Sean Fleming, said the Minister’s intention was good, in that he wanted to assist with the hand-over of farms, and separate full-timers from hobbyists. But the definition was counterproductive, and the 40-hours [of farm work] restriction had to go, he said.
Sinn Fein TD, Pearse Doherty, agreed that ‘active farmers’ be prioritised, but said the definition had to be amended. “If they can get it, people work 20, 30 or possibly 40 hours per week. The definition in this Bill means that they would have to be working 40 hours on the farm, as well, to be able to avail of this, which is simply not acceptable, so I hope that the Government looks at this, and at the definition of ‘active farming’.
Roscommon-South/Leitrim Independent TD, Michael Fitzmaurice, said it was unrealistic that an ‘active farmer’ had to prove that he spent not less than 50% of his working time farming. “The income of a small-holder farmer, with ten to 20 cattle to sell every year, will be between €10,000 and €15,000. If that farmer does not work 40 hours elsewhere, he or she could be in severe difficulty.”
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