Call to exempt farm buildings from development tax

THE government is facing calls to exempt new farm buildings from a revised approach to development tax for local infrastructure.

Developers are already charged a Community Infrastructure Levy (CIL) when planning permission is granted to build residential and commercial units.

Following a review of the system, recommendations have been made to the Government for a revised process called the Local Infrastructure Tariff (LIT).

The new approach is causing concern among some rural organisations who say it is a tax on farm planning applications which do not generate the need for infrastructure.

These organisations are the National Farmers' Union, Tenant Farmers' Union, the Country Land and Business Association, and the Central Association of Agricultural Valuers

They have have written to planning minister Alok Sharma arguing that new farm buildings should be exempt from the tax because farmers pay for their own infrastructure.

In the letter, the organisations say twhere a CIL is charged on new farm buildings, “the requirement to pay a substantial CIL charge has actually stopped farm development from taking place”.

They also argue that being included in the LIT will have a similar effect and cause financial strain for farm businesses.

As a result they have called for a national exemption from development contributions.

CLA president Ross Murray said: “A tax aimed at housing and commercial development is simply inappropriate for new agricultural buildings.

He added: “It restricts rural economic growth and prevents investment in new farm buildings which undermines competitive agriculture.”

NFU vice president Guy Smith said: “Farm operations meet their own infrastructure needs and should not have to face unconnected development taxes.”

The same view was expressed by TFA chief executive George Dunn

He said: “The government should not be seeking to discourage this through the imposition of ill thought through levies on new farm buildings.”

CAAV secretary Jeremy Moody said: “We are concerned that the particular issues of large scale but low value farm buildings have not been properly considered in this review.

“The aim of the LIT is to capture a slice of the increase in value when you erect a building but there is virtually no increase in value with agricultural buildings.”

The full letter can be viewed here.


Sign up to our newsletter to receive all the latest news and updates.