The move, announced by Chancellor George Osborne in today’s Autumn Statement, will bring forward tax relief on plant and machinery investments from January 2013 for a two-year period.
NFU chief economist Phil Bicknell said: “I am delighted the government has listened to the NFU’s call for a significant increase in the annual investment allowance. Immediate spending increases on plant and machinery may be limited for many following the challenges of this year’s harvest, but this will undoubtedly boost farm business investment over the next two years.
“The relief will benefit farmers, given that farming is a primary industry that has to continually invest in plant and machinery. Advancing tax relief helps with cash flow and funding, ultimately supporting investment across farming sectors.
“This move will pay dividends. We firmly believe that one of the key drivers to help push the economy forward is investment in new technology, which in turn will increase productivity and efficiency.
“As ever, the devil is in the detail. We will study all relevant announcements in greater depth as they become available, and assess the full impact of the Chancellor’s plans on agriculture.
“For the time being, the fact that government has taken this step to increase the annual investment allowance appears to the key headline from a farming perspective.”