Dáil Éireann Debate, Tuesday - 8 March 2005
230 Mr. Ring asked the Minister for Finance if a farmer purchases land for consolidation proposed from an estate agent or auctioneer, if stamp duty will have to be paid on these purchases with reference to the new measures introduced in the Finance Bill 2005 in relation to stamp duty on farmland exchanges for consolidation. [7841/05]
View answerAs the Deputy will be aware, the budget announced a special, one-off stamp duty relief relating to an exchange of farm land between two farmers for the purposes of consolidating each farmer's holding. The new relief will mean that no stamp duty will be charged on an exchange of such lands where the lands are of equal value. In a case where the lands exchanged are not of equal value, stamp duty will be charged on the amount of the difference in the value of the lands concerned. Where consideration is paid for the difference in those values, it must be payable in cash.
To qualify for relief, the following main conditions must be satisfied: there must be a valid consolidation certificate issued by Teagasc in existence at the date of the exchange of lands. This certificate is to be submitted to the Revenue Commissioners in support of an application for relief. The Minister for Agriculture and Food, with the consent of the Minister for Finance, will make the necessary guidelines detailing how applications for consolidation certificates are to be made to Teagasc and also setting out, amongst other things, the conditions of consolidation. The farmers involved in the exchange of lands must each sign a declaration, for submission to the Revenue Commissioners, to the effect that each of them will spend at least 50% of their normal working time farming and will farm the land exchanged for at least five years from the date of the exchange.
All the joint owners of the land exchanged, including the farmers, must make a declaration, for submission to the Revenue Commissioners, to the effect that it is the intention of each of them to retain ownership of their interest in the land and that the land will be used for farming, for at least five years from the date of the exchange. The instruments effecting the exchange of land must be submitted to the Revenue Commissioners for adjudication.
The fact that such an exchange may be negotiated through an intermediary is not material, provided the full range of criteria applying to the relief are met. However, the relief does not apply to situations where a farmer purchases land for the purposes of consolidation without an exchange of land taking place — that is, a straightforward purchase of land with no corresponding sale of land to a farmer for the purpose of consolidating that farmer's holding. If such situations were to be covered by the relief, this would represent a very considerable widening of the relief and would dilute its focus, undoubtedly leading to calls from other groups for similar treatment. It would also considerably increase the cost and administration of the relief.
