Fine Gael TD for Limerick Patrick O’Donovan has welcomed the announcement by the Minister for Finance, Michael Noonan TD, that he intends to provide a capital gains tax (CGT) exemption in this year’s Finance Bill to certain farmers who dispose of their single farm payment entitlements on foot of changes being introduced under the new EU Common Agriculture Policy (CAP).
“I welcome the decision by the Minister for Finance in conjunction with the Minister for Agriculture in providing this exemption from Capital Gains Tax. This decision comes following a change to the new Common Agriculture Policy which impacts on those farmers who lease 100% of their land and farm payment entitlements and in circumstances where those farmers could not prepare for the change due to leasing arrangements. They are therefore caught between either having to sell their farm payment entitlements or losing them under the new CAP.
“The Minister has informed me that he is prepared to provide for an exemption from CGT on any chargeable gains arising from the disposal by the owners of payment entitlements under the Single Payment Scheme where all of those entitlements were leased out in 2013 and where the owners, because of the change in CAP regulations, were advised by the Department of Agriculture, Food and the Marine, to transfer their entitlements to an “active” farmer by 15 May 2014.
“This measure while addressing this anomaly, is of huge importance in terms of maintaining confidence in the long-term leasing of farmland and its contribution towards achieving the goals set out in Food Harvest 2020.”
“This is a further commitment of this government to the Agri Sector. Over the last number of years, Fine Gael in government has demonstrated a clear commitment to the Agri Food sector as the main driver in economic recovery. I know the Minister for Finance has a close working relationship with the Minister for Agriculture, Simon Coveney TD and this is another example of how they working together can deliver for rural communities.”