Officials confirm at the Agriculture Committee that the Government can fix the anomaly hitting farmers and marts.
Aontú TD for Mayo Paul Lawless has called on the Government to use the upcoming Budget to align the livestock VAT rate with the farmer flat-rate addition.
Speaking today, Deputy Lawless said: “This week officials confirmed to us at the Oireachtas Agriculture Committee that the Government has the power to fix the VAT anomaly being experienced by farmers. Since January, the flat-rate addition paid to unregistered farmers has been 4.5%, while VAT on livestock sold through marts stays at 4.8%. It’s the first time since the scheme began in 1990 that the flat rate has fallen below the livestock rate. Farmers selling through marts are losing the difference on every animal they sell. It’s not acceptable”.
Deputy Lawless continued: “A farmer spends eighteen months rearing an animal. He pays VAT on the feed, the fertiliser, the diesel and the vet, and he can’t claim a cent of it back. When he brings that animal to the mart, the docket comes back short. It’s the same on every animal, every sale, all year. And the first thing he does is look at the mart and ask, ‘What are ye taking off me now?’ The mart isn’t taking it. The State is. ICOS told the committee today that mart throughput is down 8 to 9%, and this anomaly is part of the reason”.
“When a farmer can sell privately and avoid the deduction, some will. Our local marts give farmers a fair price and guaranteed payment, and they’re the heart of rural towns across Mayo. They’re being put at a disadvantage by a quirk in the tax system. The officials were clear today. EU rules limit what can be done with the flat rate. But the livestock rate is a matter for the Government, and it can be cut as long as it stays under 5%. The solution is in the Government’s own hands. ICOS estimates that aligning the two rates would cost between €5 million and €8 million. That’s a very small price for a fair deal at the mart, especially when last year’s cut to the flat rate from 5.1% to 4.5% took €61.5 million out of farmers’ pockets. I’m calling on the Minister for Finance to align the livestock rate with the flat rate in this Budget, and to keep them aligned. As one witness put it today, every penny is a prisoner this year. Farmers can’t afford to keep paying for an anomaly the Government has the power to fix”, concluded Lawless.
