Farm Business Council Report May 2024

VAT 

The issue on items farmers, not registered for VAT, can claim VAT back on under VAT 58 claims remains an ongoing serious issue. As previously advised, a delegation led by the IFA President and the Chair of the Farm Business Committee met with Revenue and the Department of Finance on 22^nd of January in Dublin Castle on the issue. The seriousness of the issue was laid out by IFA. Revenue reiterated what the Statutory Instrument says on what can be refunded. It states the following is what refunds can be made upon; 

1. the construction, extension, alteration or reconstruction of any building or structure which is designed for use solely or mainly in his or her farming business, 

2. the fencing, drainage or reclamation of any land intended for use for the purposes of his or her farming business, or 

3. the construction, erection, or installation of qualifying equipment for the purpose of micro-generation of electricity for use solely or mainly in his or her farming business. 

Subsequent to this, a detailed submission was made by IFA to Revenue on the issue. This outlined why numerous items, which the Revenue previously refunded VAT on but have ceased doing so over the last 9 months, should remain eligible for a VAT refund. Following this submission Revenue issued the following reply: 

Following this response we again engaged with Revenue on the issue. Representatives have agreed to meet with IFA again on the matter on a farm where the contentious investments can be viewed first hand. An update to this meeting will be provided at the Council meeting.  

Increased Cost of Business Scheme 

The Increased Cost of Business Scheme (ICOB), by its design, excluded farm businesses from applying (as they are exempt from commercial rates). This was outlined in writing to the then Minister for Enterprise Simon Coveny TD. Media reports have outlined that new Enterprise Minister Peter Burke TD is considering implementing a revised support scheme for small businesses. At the recent meeting with An Taoiseach it was emphasised by IFA representatives that farm businesses cannot be precluded from this scheme as they were from ICOB. We continue to monitor developments.  

Banking 

There remains a substantial differential in interest rates being charged by various financial institutions. In particular, the interest rates of AIB and MilkFlex remain out of line when compared with other lenders. Engagement has already taken place with AIB on the matter. The Farm Business Chair has been in contact with Finance Ireland and other related parties on the interest rates being charged by MilkFlex in order to discuss how the differential can be substantially reduced.  

Residential Zoned Land Tax 

The IFA Farm business Committee continues to make representations on the Residential Zoned Land Tax (RZLT) matter. The issue was again highlighted at a recent meeting with An Taoiseach who again committed to finding a solution to the matter. It is also one of our 5 key asks in our Local Election Manifesto.  

IFA position always has been and will remain that all genuinely farmed land must be excluded from this tax and this point must be remembered by all, especially when lobbying local councillors on the run up to local elections later this year. If a farmer wishes to get their land dezoned it is the Local Councillors who have the power to make this happen.  

The closing date to be dezoned is May 31^st 2024.  

Next Meeting 

• Wednesday June 12^th in Farm Centre