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Cereals (Co-Responsibility Tax)

Volume 87: debated on Friday 29 November 1985

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asked the Ministry of Agriculture, Fisheries and Food what assessment he has made of the effect on the relative levels of incidence of the co-responsibility tax on cereal producers in (a) the United Kingdom and (b) in other continental countries of (i) the proposed exemption of farmers producing less than 25 tonnes and (ii) the proposed exemption of all inter-farming trade; and if he will make a statement on the implications of the current proposals for United kingdom cereal producers.

The Commission suggests a co-responsibility levy on sales of cereals off the farm, from which the first 25 tonnes would be exempt. Many details need to be clarified.No information is available about sales of cereals from individual farms in the Community. But aggregate data provided by the Commission for 1984–85 suggest that about one quarter of cereals production in the EC Ten was not sold off the farm of production: the equivalent figure for the United Kingdom was about one-eighth. If this information is combined with that available from the 1979–80 EC structure survey, it can be estimated that approximately a further quarter of production in the Community of Ten might be exempted by a levy-free allowance of 25 tonnes, compared with roughly one-tenth in the United Kingdom. Thus the proportion of total EC Ten production subject to levy might be about one half compared with about three quarters for the United Kingdom.I must emphasise that these are very broad approximations dependent on several arbitrary assumptions: they take no account of how producers might adjust the proportion of sales after imposition of the levy. No data are available for Spain and Portugal.