Neale Richmond (Dublin Rathdown, Fine Gael)
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247. To ask the Minister for Finance if he will consider removing the 50% limitation in the Finance Bill 2021 on the amount of land that can be used for solar farms in relation to capital acquisition tax; and if he will make a statement on the matter. [54302/21]

Paschal Donohoe (Dublin Central, Fine Gael)
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Prior to Finance Act 2017, agricultural land which was leased for solar panels was not classified as qualifying agricultural property for the purposes of Capital Gains Tax retirement relief or agricultural relief from Capital Acquisitions Tax.

Following a review announced in Budget 2018, and in recognition of the then Government's commitment to facilitate the development of solar energy projects in Ireland, a revised approach was introduced whereby it is now possible for land leased for the installation of solar panels to be classified as qualifying agricultural property under certain conditions. A key condition is that the total area of land under lease and on which solar panels are installed does not exceed 50% of the total area of agricultural land.

While introducing this amendment, it was important that we did not lose sight of the fundamental principle which underpins our policy in relation to agricultural relief and retirement relief.

I recognise that allowing land leased for solar panels to be classified as qualifying agricultural property is an important element in encouraging solar energy projects. However, this must also be carefully

balanced with the overarching objectives of this valuable relief which aims to encourage the intergenerational transfer of agricultural land which is being actively farmed.

Therefore, I have no plans to adjust the condition that the total area of land under lease and on which solar panels are installed does not exceed 50% of the total area of agricultural land.