Budget 2021 needs to provide funding for Brexit losses, a tax rebate system for using protected urea and tools to help farmers deal with price volatility, according to the ICMSA’S pre-budget submission.

President of the ICMSA Pat McCormack said that it was the agriculture sector that led the recovery out of the last recession, and Government policy must not forget that this export-led recovery started in the green fields of rural Ireland.

“That should serve as an example for Budget 2021, where we look to again give the certainty and support that allows businesses to move forward on a sound, sustainable basis,” McCormack said.

Brexit

McCormack said that Brexit and COVID-19 are “front and centre” as the most obvious, immediate challenges.

Budget 2021 needs to provide for a fund to complement the EU initiatives that have been specifically designed for Brexit-related losses

“Despite the signing of the withdrawal agreement and political declaration in January 2020, the risks to the Irish agri-food sector remains substantial. Budget 2021 needs to provide for a fund to complement the EU initiatives that have been specifically designed for Brexit-related losses, should they arise.

“It’s impossible to over-estimate the potential damage to our agri-food sector that ‘no deal’ will cause,” he said.

Tax rebate system and new scheme

ICMSA has proposed a tax rebate system to encourage the use of protected urea for Budget 2021.

It has called for a zero rate of VAT and 60% TAMS grant to be applied on all LESS equipment.

The single most important recommendation is that adequate funding must be made available in Budget 2021 for an agri-environment scheme, relevant to all types of farming

“The single most important recommendation is that adequate funding must be made available in Budget 2021 for an agri-environment scheme, relevant to all types of farming, with payments made under this scheme in 2021,” according to McCormack.

“This scheme should work towards the ‘economic, biodiversity and environmental gains to be made from improving soil health and fertility, optimising fertiliser use and maximising our grass-based production system’, as stated in the Programme for Government.

“The scheme should improve standards of soil health and fertility and improve grass production, while achieving reduction in nitrogen application,” he said.

Volatility

In order to address income volatility, McCormack said there is a need for farmers to have a taxation system that allows flexibility from year-to-year, and allows the profits in a good year to sustain a family farm through the bad years.

The scheme should improve standards of soil health and fertility and improve grass production

“ICMSA has proposed the introduction of an income volatility management tool called the farm management deposit scheme (FMDS).

“This has been examined closely, is based on already working models, and should be a priority in Budget 2021 if the Government is serious about supporting the family farm,” he said.

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