Incentives that encourage on-farm investment are vital to ensure British farmers are fit for the future, Chancellor Phillip Hammond has been told.
In a letter to Mr Hammond ahead of next week’s Budget, the NFU calls for measures that ensure British farm businesses are in the best position to be productive, profitable and progressive as they face the challenges and opportunities of Brexit.
Mr Hammond is due to announce the government’s latest plans for tax and spending in a Budget speech on Monday (29 October). The Budget will cover the financial year which starts in April 2019 – after the UK has left the European Union.
The NFU is calling for eight measures:
- Reform of capital allowances with a review of their scope and purpose.
- Tax relief on the depreciation cost of farm infrastructure.
- Expanding and simplifying Enhanced Capital Allowances to allow early adoption of technology on farm.
- Allowing SME businesses to surrender the value of their Annual Investment Allowance or Enhanced Capital Allowances claim in return for a payable tax credit.
- A farm management deposit scheme for British farmers to allow pre-tax profits to be set aside for future use in the business, therefore improving cashflow.
- R&D tax relief extended to all trading businesses regardless of their business structure.
- Ensuring the rollout of superfast broadband to all farmers, growers and rural communities, alongside complete mobile phone coverage at a reasonable cost.
- Allowing diversified farm businesses to elect to have all income sources treated as a single trade for all tax reporting purposes, including income tax, VAT and Making Tax Digital, to reduce the administrative burden on businesses.
NFU president Minette Batters said: “It is our firm belief there are simple measures that can give [farm] businesses the means to increase their productivity and deliver more for the public, who expect high standards of quality British food.”