Don’t Abolish Agricultural Buildings Allowance, says NPA to Government

by 5m Editor
30 April 2007, at 9:40am

UK - The phasing out of the agricultural buildings allowance will be a severe blow to pig farmers, says NPA chairman Stewart Houston in a letter to Chancellor Gordon Brown.

“Our buildings are specifically designed for rearing pigs and as such are fit for no other purpose and therefore can certainly not be considered appreciating assets,” said Mr Houston.

Producers spent £100 a sow on upgrading their buildings, as a result of the United Kingdom’s unilateral ban on sow stalls in 1999, in the expectation of receiving tax relief on them. For this one area of investment alone, the pig industry still has an outstanding sum of £31million of unrelieved qualifying expenditure. Furthermore there is a tremendous need for ongoing investment.

“We need to invest in our facilities firstly to meet our legal obligations and, as importantly, to ensure a sustainable future for our industry by keeping at the forefront of welfare friendly environmental pig production,” said Mr Houston.
He said that the decision to remove the agricultural buildings allowance has not only effected pig-keepers’ investment decisions in retrospect, but it also contradicts Defra and Environment Agency policy to encourage investment in greener, higher welfare buildings.
“Our industry has continued to invest heavily as new research becomes available to ensure we constantly improve the welfare of our pigs, in terms of space requirements, light, heating, ventilation and flooring systems.
“The proposed measures, in particular the abolition of the agricultural buildings allowance, will significantly hamper producers abilities to continue this level of investment,” said Mr Houston.
In his letter to the Chancellor, he also expresses concern about the proposed 10% rate on fittings integral to buildings. However, he noted that NPA would withhold comment until it sees the Treasury’s consultation paper.

Mr Houston asked the Chancellor to reconsider and reinstate the agricultural buildings allowance, or at least to carry out a formal consultation so the pig industry can state its case fully.
He also made special mention of IPPC, which will involve a significant level of investment in new buildings and equipment.

5m Editor