Minister for Agriculture Michael Creed has welcomed two key measures in the Finance Bill in relation to stamp duty on agricultural land transactions.
He highlighted the special 1 per cent rate applying to transfers of farmland within families and the abolishing of the age restriction for the transferor as key concessions for farmers.
“Assisting succession and the intergenerational transfer of family farms has been a central part of the Government’s agri-taxation policy and recent budgets have included a number of measures to maintain and strengthen that support,” he said.
On the changes to commercial stamp duty, EY tax partner John Heffernan bemoaned that no concession was made to the real estate market outside of Dublin, which has not enjoyed the same level of recovery.
“We are disappointed that no recognition was made of the totally different commercial real estate market outside of Dublin,” he said.
“ In particular, we believe a progressive system with a 3 per cent rate for transfers up to €2 million and 4 per cent for transfers up to €5 million would particularly help projects outside of Dublin where values are lower,” Mr Heffernan said.
Uncertainty
However, he praised the Minister for clearing up the uncertainty surrounding the amendment to the existing capital gains tax (CGT) relief on disposals of land from seven to four years.
“The clarity provided through the Finance Bill today will come as great relief to those who invested with a view to realising their investment on its 7th anniversary,” he said.
Mr Heffernan said the reduction in the holding period should result in more residential land being released to the market.
There have been suggestions that a number of investors who acquired residential land in Dublin in 2013 and 2014 have been holding back the land until 2020 and 2021 waiting for the seven-year holding period to expire to avail of the capital gains tax exemption,” he added.
