Taxation of farm income
McDowell challenged the low proportion of farm income being taxed and asked whether the Government had a target for increasing it. The Minister cited legitimate allowances and the estimated 70,000 farmers not yet taxable, and said the Government intended everyone to pay tax according to income.
I will not. Farm income, as described by the Minister, is taxed in terms of personal taxation to the extent of less than 3½ per cent. Has the Minister any target to establish over the next five to ten years a different return from farm income? Has he a target of 5 per cent or 10 per cent? Has he any view on what percentage of farm income should be the subject matter of personal and/or corporate taxation? How does he propose to reach those targets?
Comment on this
Obviously the Deputy did not listen to the reply or else he does not know much about how income tax is computed. I said quite clearly that in computing the figure for farm income no account was taken of the many legitimate personal and business allowances which farmers may use in calculating their tax bills. That is the position in regard to any taxpayer. It is my intention and that of the Government to ensure that everybody in the community will pay tax according to their incomes, and that includes farmers.
Comment on this
The Minister said it is possible for farmers to deduct substantial business expenses. Supposing even half of the farmers' incomes, £500 million, was taxable as against the return of 7 per cent, which is ludicrous, is there not a suggestion that the Minister is hiding behind a difficulty in computation? Is not the reality that only between 3 per cent and 5 per cent of farm incomes are being taxed at the moment——
Comment on this
I wish to add something I had intended to say in reply to the Deputy's first supplementary. As many as 70,000 farmers are not taxable at present. That is something that successive Governments in the past 10 to 12 years have failed to take action on. We are now working towards that. I do not think any Deputy would contradict the wish of the Government to ensure that everybody will pay tax according to their incomes.