Vol. 483 No. 1
27 Mr. Penrose asked the Minister for Finance if he will change the current taxation rules to allow expenditure on milk quota purchased under the restructuring scheme as a direct tax deductible expense; and if he will make a statement on the matter. [15508/97]
A milk quota is viewed as a non-wasting capital asset, subject to the capital gains tax and capital acquisitions tax codes. If expenditure on the purchase of milk quotas was allowed as a deductible expense for income tax purposes, the logical outcome would be that the proceeds from the sale of a quota should be treated as income and, therefore, liable for income tax. At present, the proceeds are treated as a capital receipt and are subject to capital gains tax which can give much more favourable tax treatment because of indexation relief.
I have no plans to change the taxation rules covering expenditure on milk quota purchase.
