Farm Ireland

Monday 11 December 2017

‘Ground breaking’ €150m loan fund tops Budget measures for farmers

Minister Michael Creed (second from left) announcing details of the measures aimed at farmers in the Budget.
Minister Michael Creed (second from left) announcing details of the measures aimed at farmers in the Budget.
Margaret Donnelly

Margaret Donnelly

Farmers can avail of loans up to €150,000 at 2.9pc under new measures introduced in Budget 2017

Falling farm incomes were the subtext of the measures introduced for farmers under Budget 2017, which include a €150m loan fund and a number of taxation measures.

The main measure announced for farmers in the Budget is a €150m fund to facilitate low-interest loans for farmers. Under the measure, which will be administrated by the main banks, farmers can avail of loans of up to €150,000 at interest rates of 2.95pc.

The Minister for Agriculture, Food and the Marine Michael Creed described the fund as “ground breaking” and said farmers should look at their own financial circumstances to see if the loan schemes can work for them.

The €150m is a one off measure from the Department, but the Minister said it was a template that can be revisited. “We have a model now and it is ground breaking”.

Cost of Credit

Ireland, he said, is “significantly out of step when it comes to interest rates and I hope the pillar banks take note. This is a reflection of the fact that the cost of credit here is higher than it is across Europe.”

The loans do not require collateral and while the maximum loan request will be €150,000, the Department is expecting the average drawn down to be less than €75,000. The low-interest loans are available to all livestock, tillage and horticulture farmers and the Department expects the first loans to be issued early in the new year.

Also Read

Agri-Taxation Measures

Agri-taxation measures announced for farmers include an adjustment to farmers’ ‘income averaging’ system, which will give farmers the option to ‘step out’ of the system in years of difficulty – including 2016.

The Capital Gains Tax threshold has been increased by €30,000 to €310,000 for children and spouses.

The Minister also announced that his Department would be allocating €601m for investment in the Rural Development Programme, an increase of 21pc, which will allow for the re-opening of GLAS. The Minister said this would allow and extra 12,000 farmers enter the Scheme.

€10/ewe scheme

A new Sheep Welfare Scheme is to be introduced, which will give farmers €10/ewe as part of the €25m Scheme.

Minister Creed also announced an extension of the Sustainable Energy Authority of Irelands (SEAI) capital allowance scheme to non-incorporated businesses. This is designed to incentivise investment in energy efficient equipment by farmers.

Farmers can also avail of an increase in the Earned Income Tax Credit of €400. Forestry will get an injection of €111.6m in 2017 to increase forestry cover and mobilisation of the existing timber and biomass.

The organic sector will receive €10m towards the Organic Farming Scheme which has 1,600 farmers and farmers with raised bogs can enjoy an exemption from Capital Gains Tax for payments under the new raised bog restoration incentive scheme.

Online Editors