An ICOS delegation met this afternoon with Department of Finance officials on the cut that has taken place in the Flat-Rate Farmers VAT top-up, down from 5.1% to 4.5%, in effect from 1^st January, 2026.

The delegation included Ray Doyle, Livestock & Environment Executive (ICOS), Stephen Hannon (General Manager, Aurivo Marts), Maurice Lyons (CEO, Golden Vale Marts) and Michael O’Connell (Financial Controller, Cork Marts).

ICOS had strongly opposed the measure and today said it is now having a discriminatory impact on livestock marts and non-VAT registered farmers.

ICOS reiterated its call for the flat-rate addition to be amended to ensure farmers selling livestock through marts are not disadvantaged. This is particularly where livestock sales remain subject to the 4.8% VAT rate while the flat-rate addition has fallen to 4.5%, creating an anomaly that leaves farmers under-compensated.

ICOS also raised concerns that while Government has cited a CSO-based VAT calculation as the basis for the change introduced in last year’s Budget, the formula underpinning that decision has yet to be provided.

ICOS stressed that if the State needs to address balancing within the VAT system, this can and should be managed over an extended period rather than through a sharp deduction in one year that penalises farmers and marts, only to be potentially reversed in another.

“We made the case that the Flat-Rate Addition should be adjusted to align with the livestock VAT rate so that the scheme continues to fully compensate farmers, as originally intended, without distorting competition or imposing a hidden cost on livestock producers,” said Ray Doyle.

“ICOS will continue to engage constructively with the Department, but our position remains firm. Marts must not be discriminated against. Non-VAT registered farmers must not be financially penalised, and the flat-rate scheme must remain simple, fair and fit for purpose. This is obviously also a priority in the current inflationary climate which is burdening rural communities with additionally excessive costs.”