Submission made ahead of Finance Bill

IFA has put forward a number of practical proposals to the Minister for Finance to offset the imposition of the additional carbon tax on farm diesel, as the Budget measures are totally inadequate to deal effectively with the problem.

IFA has put forward a number of practical proposals to the Minister for Finance to offset the imposition of the additional carbon tax on farm diesel, as the Budget measures are totally inadequate to deal effectively with the problem.

Under the Programme for Government, a clear commitment was given to ‘exempt farm diesel from further increases in the carbon tax’. The proposals are part of IFA’s submission ahead of the publication of the Finance Bill.

IFA President John Bryan said farmers who are registered for VAT must be able to claim a direct refund on the additional carbon tax costs, which ensures a 100% refund. “This can be done in an administratively efficient way at the same time as they make their VAT return.”

He said unregistered farmers should pay, at point-of-sale, a fuel price net of the carbon tax increase. The fuel distributors could then claim the rebate in bulk from the Revenue Commissioners.

On farm consolidation, the IFA President said relief from Capital Gains Tax (GCT) would improve the efficiency of farm operations, generate additional output and exports, and assist in reaching growth targets set out in Food Harvest 2020.

John Bryan remarked, “Farm fragmentation is a key barrier to efficient farm production. The recent Budget contained a number of positive measures to aid land mobility. To maximise the impact of those measures, there is a need to introduce relief from CGT for farm consolidation.”

IFA submission also includes a provision to extend the increased stock relief for registered farm partnerships to all registered partnerships, and not just Milk Production Partnerships.

IFA is also proposing that, in line with the general functioning of the VAT Refund scheme, unregistered farmers should be able to claim the refund of VAT on wind turbines purchased during the last four years.