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Tax breaks for farmers causing 'subsidy addiction', government adviser warns

tractor - Copyright 2017 The Associated Press. All rights reserved.
tractor - Copyright 2017 The Associated Press. All rights reserved.

The head of a group which advises the government has called for a review of tax breaks for farmers.

Economist Dieter Helm, who chairs the independent Nature Capital Committee which advises the Department for Environment, Food and Rural Affairs, said the current system led to "subsidy addiction".

Farmers will be paid for delivering benefits for nature and the countryside after Brexit instead of receiving subsidies for the amount of land they farm, Defra secretary Michael Gove has indicated.

A combine harvester - Credit: Owen Humphreys/PA
A combine harvester in a field near Langwathby in Cumbria. Credit: Owen Humphreys/PA

However, Professor Helm, who said he was speaking in a personal capacity, told BBC Radio 4's Today programme: "If you're producing 0.7% of output, receiving £3 billion of subsidies for that output of about £9 billion and being exempted on rates, and being exempted on diesel and being exempted on inheritance tax, this is quite a list and we've got there by accident almost, one after another of these concessions has been made, it's kind of a subsidy addiction in the end.

"Farmers receive not just the £3 billion of subsidy, they receive a whole range of other benefits that nobody else in the economy gets."

Defra secretary Michael Gove 
Defra secretary Michael Gove and Liam Fox, International Trade Secretary

National Farmers Union vice president Guy Smith told the BBC that government assistance helped British agriculture stay competitive.

"What we are rightly weary of is having to compete against farmers in other parts of the world who get greater levels of support, or who have different costs of production because of different policy."

A spokeswoman for the Department for Environment, Food and Rural Affairs (Defra) said Prof Helm headed a committee on the environment, not farming policy.

"These ideas are not under consideration. The Secretary of State has been clear that he wants to go on generously supporting farmers for many more years to come."