The government has agreed an amendment to the Finance Bill 2024 which may provide for a delay to changes to agricultural relief announced in Budget 2025.
The bill will be amended so that the agricultural relief changes will require a commencement order to be signed before they can come into force.
The aim of this change, according to Taoiseach Simon Harris, is to allow further consultation to take place with stakeholders on these changes, which have proven controversial since their announcement in October.
The Taoiseach confirmed the amendment to the Finance Bill at the Irish Farmers’ Association’s (IFA’s) Farming and Food Conference in The Curragh, Co. Kildare today (Thursday, October 31).
Speaking to journalists at the event, the Taoiseach said: “We heard from the IFA and others on concerns they’ve had on some of the changes in the Finance Bill regarding Capital Acquisitions Tax (CAT) and agricultural relief.
“I’m very pleased that myself and the minister for finance (Jack Chambers) have agreed amendments to the Finance Bill to provide for a commencement order. In other words, it wouldn’t come in (to effect) until there’s been proper consultation and engagement with stakeholders,” the Taoiseach added.
Budget 2025 saw an announcement that the active farmer test will be extended to the disponer of the agricultural property. This change by government aims to ensure that relief benefits real farmers rather than speculators.
The change means that the disponer must also be an active farmer for six years prior to making the gift or inheritance. The six-year period ends immediately prior to the date of the gift or inheritance.
However, this extension of the active farmer test has been criticised, with several farm organisations warning that the change may increase the tax bill for active, genuine farmers.
The Taoiseach said today: “We’re endeavouring to make changes that are sensible, changes in terms of those who aren’t farmers and those who shouldn’t be able to benefit from reliefs and should pay their way in that regard.
“But there clearly can’t be unintended consequences. The intent is solid, but rushing its implementation would be really foolhardy,” he added.
It is expected that the Finance Bill will be finalised and passed next week.