19 August 1998
Number of dairy farmers ‘to fall below 30,000’
THE number of dairy farmers in Britain is set to fall below 30,000 for the first time ever, according to the Farm and Rural Conservation Agency.
Thet agency estimates that almost 2000 producers left the industry last year. A further 1250 left the previous year and a further 2500 are earmarked to quit during 1998.
Low prices and poor profitability are contributing to the decline. Many farmers are thought to have been influenced by this years decision to taper off retirement relief on capital gains, notably the value of milk quota which amounts to an average of around £18,000 at current values. This is against a zero value when introduced in 1984.
The Finance Act is designed to cut the ceiling for tax-free capital gains from £250,000 in stages of £50,000 a year from next April, matched by a tapering-in of tax payments by 1% a year over ten years.
Tax experts predict farmers have a window of a few years before they are liable for greatly increased tax.