THE Government has been urged to ignore proposals to impose business rates on agricultural land and farm buildings.

As reported in the D & S Times last month, Sir Michael Lyons' recent review of local government funding proposed the present exemption could end - raising about £300m.

However, Neil Parish, Conservative agriculture spokesman in the European Parliament, this week said that any such move would cripple UK farming.

He has called on the Treasury and David Miliband, Secretary of State at Defra, to rule out any such move immediately.

Mr Parish, who chairs the European Parliament's agriculture committee, said the plans would once again put British farmers at a significant disadvantage to those on the continent.

"Farm incomes will be substantially reduced if these proposals are enacted, he said.

"The total income from UK farming has more than halved in the past decade and this new tax would be the straw that broke the camel's back for many farms.

"The Chancellor has clearly written off the rural vote at the next election, and he must be stopped from making a devastating smash and grab raid on farmers for the sake of a few hundred million pounds to plug his spending gap."

l EU Agriculture Ccommissioner Marianne Fischer-Boel will back any move to form co-operatives to win UK dairy farmers fairer prices.

She gave her assurance to members of the all-party Parliamentary Dairy Group, which visited her office in Brussels.

They lobbied the Commissioner on the state of the British dairy industry and the below cost of production price most milk producers received.

Roger Williams, Lib Dem member of the group, said they emphasised the difference in approach to competition in other EU countries.

They pointed out that in Denmark, Arla had 80pc of the dairy product market, enabling it to drive a hard bargain with supermarkets.

Mr Williams said: "In this country, any increase in market share by farmers' co-operatives is threatened with an inquiry by the Office of Fair Trading, so deterring any strengthening of the farmers' clout in the market place.

"We were well-received by the Commissioner, who gave us an assurance that any proposals to secure better prices through building up farmers' co-operatives would be looked at favourably by the Commission and she would make representations in support to Defra."

Later Mr Williams welcomed Tesco's announcement of a 4p a litre increase for dairy farmers who will supply them.

However, he said: "Supermarkets are becoming afraid that they cannot depend on an assured supply of British products and are therefore having to give a fairer price.

"I would encourage all farmers to make a submission to the Office of Fair Trading, which is carrying out an inquiry in to supermarket practices."