Written answers

Tuesday, 25 May 2021

Photo of Matt CarthyMatt Carthy (Cavan-Monaghan, Sinn Fein)
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199. To ask the Minister for Finance the engagements he has had regarding the potential to provide a carbon tax waiver for registered agricultural and forestry contractors; when he plans to implement such a waiver; and if he will make a statement on the matter. [28054/21]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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I refer the Deputy to my reply to him of 21 April last (No. 522) in which I advised that agricultural and forestry contractors were not currently eligible for tax relief under section 664A of the Taxes Consolidation Act 1997 as they are not considered to be carrying on a trade of farming. This is because farming, which is defined in section 654 of the Taxes Consolidation Act 1997, requires that the occupation of farmland and agricultural contracting does not involve the occupation of farmland. The measure is specifically targeted at the farming sector to address the particular problems faced by family farms.

The reply also outlines that my officials met with agricultural contractor representatives in December 2019 and advised them that my Department was intending to schedule a review of the scheme (and related aspects) in the context of a wider report on agri-tax reliefs and the Climate Action Plan approved by Government in June 2019. The onset of the Covid-19 pandemic in the intervening period has influenced the timing of such a review which has yet to take place. This remains the position.

As I also indicated in my reply of 21 April, while I appreciate the difficulties facing many sectors as a result of increases to the carbon tax, I must be mindful of the public finances and the many demands on the Exchequer, as well as the need to progress the Programme for Government commitments on the environment. The introduction of new tax reliefs - or indeed the extension of existing targeted reliefs - reduces the tax base and makes general reform of the tax system that much more difficult.

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