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Tax Reliefs

Dáil Éireann Debate, Tuesday - 9 June 2020

Tuesday, 9 June 2020

Questions (41)

Colm Burke

Question:

41. Deputy Colm Burke asked the Minister for Finance if he will consider retaining farm consolidation relief (details supplied); and if he will make a statement on the matter. [9925/20]

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Written answers

Farm Consolidation Stamp Duty relief is a measure which allow a farmer to claim relief from stamp duty where he or she sells land and purchases land, in order to consolidate his or her holding. The relief, as set out in section 81C of the Stamp Duties Consolidation Act 1999, is due to expire at the end of this year.

There are a number of conditions that must be satisfied for the relief to apply. There must be both a sale and a purchase of land within a period of 24 months of each other. Where other qualifying conditions are satisfied, stamp duty is chargeable only to the extent that the value of the land that is purchased exceeds the value of the land that is sold. A reduced rate of 1% is charged on the excess, if any, of the purchase value. If the sale takes place before the purchase, then relief will be given at the time of purchase. However, if the purchase takes place first, then stamp duty will have to be paid but can subsequently be refunded when the sale takes place.

An important condition for the relief is that Teagasc must issue a certificate stating that a sale and purchase (or an exchange of farmland) was made for farm consolidation purposes. The criteria to be used by Teagasc for this purpose and the information to be supplied are contained in guidelines published by the Minister for Agriculture, Food and the Marine.

Following the farm consolidation, a farmer must retain ownership of the farmland for a period of five years and must use the land for farming. Where any part of the land is disposed of before the end of this five-year holding period, the stamp duty relieved can subsequently be recovered by Revenue, or partly recovered, as appropriate.

My Department is currently carrying out an ex-post evaluation of the Stamp Duty relief which will examine the case for any amendment or extension of the relief beyond its current expiry date. In this regard, my officials have been in contact with the IFA, the ICMSA and Macra na Feirme, as well as with their colleagues in the Department of Agriculture, Food and the Marine and Revenue in order to gather views and opinions which will help inform the evaluation of the relief. The findings of this evaluation will feed into the decision-making process in the run up to Budget 2021 and Finance Bill 2020.

Consolidation relief in respect of capital gains tax (CGT) is also available under section 604B of the Taxes Consolidation Act 1997. This relief was extended to 31 December 2022 by section 35 of Finance Act 2019.

The Deputy will appreciate that it would not be appropriate for me to comment at this time, on what changes, if any, are being considered in this relief or any other tax relief.

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