I welcome the Minister of State. I raised this issue during the course of the debate on the Finance Bill 2014 and want to delve into it a little further with the Minister of State. When I raised it initially with him in the context of recommendations tabled on Committee Stage, he said the relief was designed to encourage active farmers to productively use lands inherited and that, as such, the Revenue Commissioners would apply the legislation flexibly to ensure genuine cases could qualify for the relief in circumstances in which they might not satisfy the strict letter of the law. He said, "flexibility is there."
The purpose of the recommendation we tabled at the time was to deal with concerns that an individual who inherited agricultural property while living abroad but who wanted to actively farm the property would not qualify for the capital acquisitions tax agricultural relief because he or she might not be able to return home for some time in order to do so. At the time the Minister of State advised that the Department could not legislate for the multiplicity of situations that might arise and that that was where flexibility on the part of the Revenue Commissioners would come into play. I am using the opportunity provided by this Commencement debate to try to determine how the legislation will be applied flexibly and how the Revenue Commissioners will determine genuine and bona fide cases in applying the relief. What criteria and processes will be involved in ensuring enforced delay will not prohibit the making of an application for relief?
We support the principle of encouraging active farmers and active farming. However, the provisions of the section could mean that we might see situations where, on the demise of parents and where the farm holding was gifted, the inheritor would have to be in a position to continue actively farming the holding for a period of six years or to lease it for a period of not less than six years. As I mentioned during the aforementioned debate, this could have a very negative effect on members of the diaspora. This issue has come up in my constituency on numerous occasions because it is made up of small to medium-sized holdings. It is a real concern for intended inheritors who plan to take over a farming enterprise at some stage but who are, often because of economic circumstances, currently living in the United States of America, Australia, New Zealand and elsewhere. Many of them had to emigrate because of a lack of employment at home.
The requirement is that 50% of a farmer's time should be spent in actively working on the farm, but the option of seeking off-farm work to meet the other 50% is not available because the people concerned are living abroad and not able to engage in active farming immediately. In many cases, it has always been their intention to return to Ireland after a number of years, but there is no interchangeability between the leasing requirement and the requirement to actively participate in farming. These individuals are part of the diaspora because of economic difficulties in Ireland and some believe they have not been given due consideration in the legislation.
Essentially, as I understand it, the Minister of State and I are on the same page. The Department is intent on ensuring agricultural and productive land is in the hands of young, active farmers and I would not deny the importance of this. However, we must take into account those with smaller holdings in rural Ireland where family members have been displaced through emigration because there are no other employment opportunities available to them. I previously recommended that a grace period be allowed for persons in the circumstances I have described, but I am happy to work with the Minister of State on this issue. I ask him to clarify how the concept of flexibility will be applied. It is one thing to say there is flexibility but ensuring it is applied in practice is another entirely. I know of a lot of people who are worried.
