Consistent and long-term investment allowances and better taxation tools are two of the key areas the NFU is urging the Chancellor of the Exchequer to address in this week’s Budget.
The NFU has put forward its suggestions in a bid to help the industry invest, grow and thrive.
NFU President, Meurig Raymond, has written to George Osborne highlighting the need for government help to encourage farmers and growers’ to invest, to deal with volatile weather and to help put more British food on British plates.
The letter also asks government to ensure its national infrastructure plan does more to promote the rural economy by reducing flood risk and fast-tracking the roll-out of high speed broadband.
And Mr Raymond also highlights the plight of farms threatened by the High Speed 2 project.
“As George Eustice emphasised at the NFU Conference, there are huge opportunities for agriculture to grow, both home and abroad, but we need the right systems in place to give the industry confidence to invest and deal with increasingly volatile weather when it happens,” he said.
“The rural economy is worth £211 billion a year, driving local growth and contributes significantly to the wider economy. This is why we would urge government to consider our recommendations to boost investment in agriculture and close the growing gap between domestic production and consumption.”
Our three key recommendations to government:
- Retain an appropriate and consistent level for the Annual Investment Allowance (AIA).
Agriculture needs a permanent AIA level of £250,000 to encourage SMEs to increase investment in specialist plant machinery and to plan further investment;
- The introduction of an infrastructure investment allowance.
This would deliver relief over an appropriate of around 25 years – giving the right signal to businesses that government wants them to invest and grow, while delivering relief in an affordable manner for government;
- Taxation tools to improve farm business management of volatility.
The NFU wants new measures in place to allow farmers to retain profits in good years to meet the demands of bad years i.e. when adverse weather or volatile markets can affect their profitability.