Consistent and long-term investment allowances and better taxation tools are key areas the NFU is urging Chancellor George Osborne to address in the forthcoming Budget.
The NFU has written to Mr Osborne highlighting the need for the Government to encourage farmers and growers to invest, deal with volatile weather and help put more British food on British plates.
The letter, from new NFU president Meurig Raymond, also wants the Government to ensure its national infrastructure plan should do more to promote the rural economy by reducing flood risk and faster rollout of high-speed broadband. Mr Raymond also highlights the plight of farms threatened by the High Speed 2 project.
He said: “As George Eustice emphasised at the NFU Conference, there are huge opportunities for agriculture to grow, but we need the right systems in place to give the industry confidence to invest and deal with increasingly volatile weather when it happens.”
The three key recommendations which the NFU is urging the Government to act on are:
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.
Introduce an infrastructure investment allowance. This would deliver relief over around 25 years – giving the right signal to businesses that government wants them to invest and grow, while delivering relief in an affordable manner.
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 ie, when adverse weather or volatile markets can affect their profitability.