The Irish Co-operative Organisation Society (ICOS) has described the Government commitment in Budget 2025 to advance an income stability measure for the farming and the dairy sector as a “step in the right direction”.

Since 2016, ICOS has called on the Government to introduce an income volatility measure for the dairy sector. The taxation measure proposed by ICOS, would enable a farmer to use periods when market returns are higher to create a modest “rainy-day” fund, to support them during periods when market returns are weaker.

The ICOS proposal known as “5-5-5” would allow a farmer to voluntarily defer up to 5% of their gross receipts in any one year.  The deferred funds can be drawn down at any time within 5 years, and subject to income tax at the time of draw down, and would work alongside current 5 year income averaging.

There is no reason why the Government could not have provided a firmer commitment in this year’s budget. Nevertheless, the commitment to advance the proposal is a welcome step forward.

ICOS is confident that any legal or regulatory issues regarding deferred income can be addressed, from a farmer, co-op and revenue perspective.

We have made several submissions to the Government based on the precedent set by the milk quota regulations and the operation of client accounts across multiple sectors.

We look forward to engaging further with the Department of Finance and Department of Agriculture, Food and Marine on this important issue for milk suppliers and the dairy co-operative sector.