LEADING auctioneer Paddy Jordan believes the new rate of 6% stamp duty on commercial property purchases should not be applied to stud farms or any agricultural land.

The stamp duty hike, from 2%, was arguably the most controversial measure in this week’s Budget and appeared to even catch the Minister for Agriculture unawares. The Irish Farmers Journal has reported there are moves behind the scenes to have the 2% rate retained for farmland sales.

The Newbridge-based Paddy Jordan described the increase as “a bolt from the blue” and said he believes it will discourage new players from entering the breeding business as well as hindering existing breeders from buying more land.

“I sold a 100-acre farm in Portlaoise on Budget day and the stamp duty payable by the purchaser was €27,000. If it was sold the next day the stamp duty would have been €81,000. This will affect everyone except the very biggest operators. In my opinion, agricultural land should be exempt from this or, at the very least, it should stay at 2%.”

Maynooth auctioneer Willie Coonan commented: “When the Finance Bill is published next Thursday we will see a proper definition of commercial property and, until then, I think judgement should be reserved. Obviously any increase in costs is not of benefit to consumers but I don’t think this would have a dramatic effect on the stud farm business.”

Shane O’Dwyer, CEO of the Irish Thoroughbred Breeders’ Association, commented: “The imposition of a 6% rate on sale of farms will impact negatively on many breeders who are trying to buy land to improve the viability of their operations. It remains to be seen if any exemption can be put in place to exclude farming land and keep stamp duty at the current 2%.”