Written by Rachel Martin
The Tenant Farmers Association (TFA) has written to the Chancellor of the Exchequer, ahead of the Autumn Budget, with proposals for reform of taxation to encourage longer, more sustainable Farm Business Tenancies.
TFA chief executive George Dunn said: “The Treasury has, down the years, shied away from its responsibility to consider how it can help to influence the market in agricultural tenancies, by rewarding landlords prepared to let land on a long-term basis.
“The Government is challenging the agricultural industry to build resilience, raise productivity, manage risk and secure long-term profitability.”
Dunn explained that improving security for tenant farmers could also help the agricultural industry di more for the environment.
“For the tenanted sector of agriculture, of which nearly half is now let under Farm Business Tenancies. It is difficult, if not impossible, to achieve both goals for sustainable businesses and the environment, when the average length of term is only four years or less,” Dunn explained.
“85% of all new tenancies are let for no more than five years. There is a significant and urgent need to move these metrics to create a longer-term horizon to plan for, and deliver the objectives of sustainable development.”
The TFA’s proposals to encourage longer-term Farm Business Tenancies include the following:
- Restricting 100% Agricultural Property Relief from Inheritance Tax only to those prepared to let for 10 years or more;
- Offering landlords prepared to let land for 10 years or more the ability to declare their income as if it was trading income for taxation purposes;
- Clamping down on landowners using share-farming, contract-farming, share partnerships and grazing licences as what the association describes as ‘thin veneers of trading activity’;
- Reforming Stamp Duty Land Tax to end discrimination against longer tenancies.
Dunn added: “The Chancellor has said that he wishes to simplify the tax system. However, he must ensure to deliver a system that supports wider Government objectives for the agricultural sector including promoting longer-term farm tenancies.”
The post TFA: Taxation system should not reward poor farm tenancy practice appeared first on Agriland.co.uk.
Continue reading on the Agriland Website...
