The 2018 budget will be delivered in September by new Minister for Finance Paschal Donohoe. The IFA announced its budget priorities on Wednesday, a mix of the continuation of existing measures and some new ones.

The low-interest loans which were introduced in last year’s budget proved very popular with farmers. A €150m scheme with the SBCI and the three main banks –Bank Of Ireland, AIB, and Ulster Bank – emerged in the spring and was massively oversubscribed.

The IFA wants funding again in the 2018 budget for a low-cost loan scheme, not just for working capital but also on-farm investment funding.

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Listen to IFA farm business chair Martin Stapleton in our podcast below:

Under the Programme for Government, the ANC (disadvantaged areas) scheme will receive a €25m increase in funding for 2018, restoring funding to 2008, pre-cut, levels.

The IFA wants the BGDP budget increased by €77m (up €25m) – an extra €50/cow, and the Sheep Welfare Scheme increased by €5m to €30m.

Investment aid for horticulture should increase to €8m. Farm safety measures include a PTO scrappage scheme.

Delivery on Government commitments for the Fair Deal Scheme are sought. Increased funding for the walks scheme is sought. An increase of €700 in the earned income tax credit for self-employed people is due. This will bring its value to €1,650, equal to the PAYE credit, fulfilling Government commitment for equity in tax credits by 2018.

Two adjustments are proposed for income averaging – firstly, that the scheme be extended to farmers who have a separate source of self-employed income, and to farmers whose spouse has a self-employed income. Currently, only those who have PAYE or no off-farm income qualify.

Secondly, the IFA wants the option of availing of a “step-out” deferral of income-tax payment more than once in a five-year period, provided no deferred income tax is still outstanding.

An extra tax planning/income volatility measure is also being proposed. This would allow farmers to deposit funds in a high-income year, which would be reintroduced to the farm business within five years. Tax would be due on the year when the money is drawn down.

Retention of key schemes

IFA wants to see the stamp duty relief for farming asset transfer to young trained farmers – the “consanguinity relief” to be extended. It cuts the stamp duty rate from 2% to 1%, but is due to end on 31 December.

Retention of ongoing agricultural relief and CAT thresholds is also sought.

Vaccine VAT

A novel proposal is that VAT be removed from non-oral medicines. Currently, Vat does not apply on oral medicines. The measure is designed to encourage increased vaccination, improving herd health.

Renewable energy features prominently, with agricultural relief for land under solar farms, tax incentives for community-based renewable projects and accelerated allowances for emission-efficient equipment.