I had been speaking yesterday evening about the importance of providing the necessary incentive for farmers to increase production and I stated that the taxation system proposed in this Bill will have the direct opposite effect. Therefore, this is a matter which the Government must tackle without delay especially since the agriculture industry is our greatest national asset and is responsible for more than 50 per cent of our total exports
In regard to taxation and, in particular to the taxation of farmers, it is the policy of Fianna Fáil that the necessary incentives be provided at all times. We favour greatly the notional system. It has now been agreed by all concerned that farmers must pay their fair share of taxation. They have no objection to that but they must be given the necessary scope to increase production.
The notional system must be retained if this very necessary incentive is to be given. While retaining the notional system we must take into consideration the other various expenses associated with farming such as contract charges and wages, including family wages. The Government have fallen down in relation to these considerations. Most of the work on quite a number of farms is done by the family and they must receive compensation for their work in contributing towards farm output. From time to time we have had assurances from the Minister for Finance but later on we found that those assurances meant nothing. We had an assurance in relation to farming taxation two years ago and we now find that more and more farmers are coming into the tax net. Small farmers and farmers with very low valuations who have to resort to other work to augment their incomes are included in the tax net. This is a further disincentive to increased production.
Among the worst anomolies contained in this Bill is the one where a farmer will pay double the amount of tax when compared with a person earning a similar income in a different walk of life. That is the muddled thinking contained in this Bill. Rates can also be considered as a further taxation on a farmer's line of production. People in industry pay taxation only on their profits, but a farmer pays rates irrespective of his income, in a good year or a bad year. Farming is a type of industry which depends on the climate. This is not taken into account particularly by the members of this Government who complain that farmers are not paying their fair share of taxation. The notional system of taxation must be retained, taking into account the various other expenses that arise, otherwise the taxation imposed on farmers through the notional system can be drastically increased at the whim of any Minister for Finance who finds himself short of money.
It is quite obvious in this Finance Bill that the Minister finds himself very short indeed through the mismanagement and inability of the Government to right the finances of the State. We must take a careful look at the system of taxation for farmers, because they are the wealth of the country. With increasing farm incomes all the other sections of the community benefit. Farmers are not a privileged class of citizen, but as builders of our staple industry they should not be subjected as they are now by this Government, to repressive taxation. We should consider what farming could mean to the development of our country in the years ahead. We should realise that we cannot hope to increase agricultural production under the present system of repressive taxation.
The concept of taxation as outlined by the Minister last year and this year is harsh and repressive. I find it extraordinary that a man who says he is committed to the development of this country and its industry and its people should take this extremely harsh attitude to agriculture. It has become fashionable for some sections to say the farmer is doing well. We must consider the good years with the bad years. For many years the farmer found it difficult to make ends meet.
I urge the Minister to have a major rethink on the whole question of farming taxation and to ensure that the incentives which are necessary for increased production are safeguarded. The Finance Bill does not do that. I hope that on Committee Stage the Minister will consider the many fine suggestions made from this side of the House on this matter and many other matters which affect the economy. The Government are responsible for inflation and unemployment because of their budgets this year and last year. The taxation imposed in last year's budget was responsible for 4 to 5 per cent of the inflation which hit the country last year. We hope the days of this Government are numbered and that, when we are discussing the Finance Bill next year a Minister for Finance from the Fianna Fáil Party will be leading the country again to the progress and prosperity we enjoyed up to 1973.