Tax relief for Prairie livestock producers facing the impacts of extreme weather
OTTAWA, ON, Aug. 30, 2022
OTTAWA, ON, Aug. 30, 2022 /CNW/ - Canadian farmers are directly impacted by climate change and its effects can be detrimental to sustaining operations. To provide assurance for producers as they make difficult herd management decisions, today the Minister of Agriculture and Agri-Food, the Honourable Marie-Claude Bibeau, announced an initial list of designated regions in Alberta, Saskatchewan and Manitoba where Livestock Tax Deferral has been authorized for 2022 due to extreme weather conditions.
The Livestock Tax Deferral provision allows livestock producers who are forced to sell a significant amount of their breeding herd due to drought or flooding to defer a portion of their income from sales until the following tax year. The income may be at least partially offset by the cost of reacquiring breeding animals, thereby reducing the potential tax burden associated with the original sale.
Eligible regions have been identified based on weather, climate and production data, in consultation with industry and provinces. The criteria for identifying regions for Livestock Tax Deferral includes forage shortfalls of 50 per cent or more caused by drought or excess moisture. The Government of Canada will continue to monitor conditions across the country to determine whether the addition of other regions throughout the year are required.
In addition to the Livestock Tax Deferral provision, producers have access to a comprehensive suite of Business Risk Management (BRM) programs to help them manage significant risks that threaten the viability of their farm and are beyond their capacity to manage. BRM programs are often the first line of support for producers facing disasters and farmers are encouraged to make use of these programs to protect their farming operations.
To help farm families succeed in a changing climate, the Government of Canada will continue to support farmers with the tools they need to get through the challenges of today, while working to build a sustainable future for the agriculture sector in Canada.
"Canada's producers continue to show remarkable resilience as they face challenges and uncertainty due to extreme weather conditions. Designation of the Livestock Tax Deferral provision provides farmers with the resources needed to make informed decisions and focus on rebuilding their herd and their operations."
- The Honourable Marie-Claude Bibeau, Minister of Agriculture and Agri-Food
Under the Livestock Tax Deferral, to defer income, the breeding herd must have been reduced by at least 15%.
The federal, provincial, and territorial (FPT) Ministers of Agriculture reached an agreement in principle for the new, five-year, Sustainable Canadian Agricultural Partnership at their Annual Meeting in July 2022, which comes into effect April 1, 2023. To enhance economic sustainability, Ministers agreed to improve BRM programs, including raising the AgriStability compensation rate from 70% to 80%, and implementing new measures to make the programs more timely, equitable, easy to understand, and better protect producers against climate risk.
SOURCE Agriculture and Agri-Food Canada