News that Government has dropped plans that posed a long term threat to growers supplying a resurgent cider industry and farmers offering holiday cottage accommodation is common sense said the NFU today.

Although details are still to be confirmed, the NFU has lobbied long and hard for the Furnished Holiday Lettings (FHL) rules to stay in place. The controversial measures repealing the favourable tax treatment were due to come into effect this month but have been de-railed in the pre-election ‘wash-up’. The changes, announced in the 2009 budget, meant many owners of self-catering properties would have been unable to claim important tax reliefs, and could have restricted the supply, at a time when the demand for stay at home holidays is at an all-time high.

There has also been a reprieve for the cider industry with the Government abandoning its proposals for a 10 per cent increase on duty, which will now last only until the end of June.

NFU Deputy President Meurig Raymond said: “News that these two measures are being dropped is a huge boost for the rural economy. The NFU has been fighting for over a year to prevent the unfair and disproportionate repeal of the FHL rules. We have been working with MPs from all parties, and with our colleagues in the tourism industry, to press home that a complete repeal of the beneficial rules would be extremely damaging to the rural economy.

“Finally, at the eleventh hour, it seems our calls have been heeded, and we’re grateful to those who have helped us secure this victory for common sense. We will reserve final judgement until we have seen the detail of the new changes but we are confident that the new regime will allow most farmers who provide catering accommodation under the FHL rules to continue to do so unhindered. And we will continue to work hard to make sure the new tax framework for FHL providers is fair and continues to promote the rural economy and help farmers and growers who have diversified into this important area.

“The NFU is also extremely pleased to see that Government plans to disproportionately increase duty on cider will be short-lived and will expire on June 30. There was widespread opposition to the move from both the cider industry and consumers.

“The prospect that both the FHL repeal and the cider duty increase may return remains very real, depending on the result of the election. I would urge NFU members to raise these issues with prospective parliamentary candidates.”