Agriculture Minister Simon Coveney said Tuesday’s Budget measures such as a new self-employed tax credit of €550, and USC reductions, will mean over €800 in additional net income, or 3.5%, based on the average 2014 National Farm Survey family farm income of €26,974.
Noting how important the farming and agri-food sector is to the economy, Finance Minister Michael Noonan also introduced a new succession transfer proposal.
Subject to state aid approval by the EU, it will allow two people, for example family members, to enter a partnership with provision for transfer of the farm to the younger farmer at the end of a specified period, not exceeding 10 years.
To support this transfer, an income tax credit worth up to €5,000 per annum for five years will be allocated to the partnership and split according to the profit-sharing agreement.
A full year Exchequer cost of €10 million is projected.
Minister Noonan also announced renewal for three years of four existing tax measures on stock relief and stamp duty relief; and retention of agricultural relief from capital acquisitions tax.
Farmers will also benefit from the increase in the parent-child capital acquisitions tax threshold from €225,000 to €280,000.
At a projected annual cost of €1m, removal of forestry income from the ‘High Earners Restriction’ for active foresters and farmers who manage their plantations on a commercial basis, means that clear-felling income will become tax-free.
The haulage industry — vital in farming and other rural industries — has welcomed a motor tax reduction for all commercial vehicles above 4000kg (worth over €4,000 per vehicle above 19,000kg).
Heavy commercial goods owners are advised to renew their motor tax for the shortest period possible, to avail of the new rates from January 1 next.
IFA president Eddie Downey said the increase in funding for agriculture for next year to €1.3bn will ensure that farmers entering new schemes under the RDP will finally get much-needed payments after years of cuts.
Minister Coveney said the Exchequer contribution to his Department’s expenditure will increase by €109m, to €1,351m in 2016.
Sheep fencing and grain storage will be included in the next tranche of TAMS with funding allocated of €35.8m.
Junior Agriculture Minister Tom Hayes welcomed the increased funding of €12m for the organic sector.
Department expenditure will includes increased provision for the Bord Bia Beef and Lamb Quality Assurance Programme; an increase of €6m or almost 9% to €74m in the Horse and Greyhound Racing Fund; and €2.8m to assist local authorities in reducing incidences of horse abandonment and in advancing horse projects for urban and traveller horse owners.
IFA, ICMSA, and ICOS had only one Budget complaint — the lack of measures to help farmers manage milk price volatility, such as an income deferral scheme.
ICMSA President John Comer said this is the single biggest challenge facing farmers.
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