Drought conditions stretching from British Columbia through to Quebec have led to a shortage of feed across most of southern parts of Canada and now the federal government is stepping in to offer relief for livestock operators.
“This is not an abnormal event, deferrals happen when the weather gets ahead of farmers, when there is nothing they can do about it,” said Bruce Tait, the senior vice-president of agriculture with MNP.
Agriculture and Agri-Food Canada has released its initial list of regions plagued with drought conditions. The list names more than 20 municipalities in Alberta alone. Lethbridge County is one of them.
“When you look at the overall picture, we probably only had a little over an inch-and-a-half of rain in places — some places a little more, some places not that much,” said Lorne Hickey, the reeve of Lethbridge County.
“It’s been a big concern for quite some time,” Hickey said.
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The designated areas can now apply for a tax-deferral provision. Producers deferring income can only do so with their breeding herd where:
- the breeding herd has been reduced by at least 15 per cent but less than 30 per cent, in which case 30 per cent of income from net sales can be deferred;
- the breeding herd has been reduced by 30 per cent or more, in which case 90 per cent of income from net sales can be deferred.
“It gives them the opportunity to wait until conditions are better and hopefully they will buy back that breeding herd to the size they need it to,” Tait explained. “So the income and the expense will be in the same period and basically offset each other so the farmer won’t have that additional tax burden that they would have faced without the deferral.”
Every year, areas across the country impacted by Mother Nature can be listed for a tax deferral by the federal government. Many of the regions suffering this year were also hit last year. Hickey hopes the constant setbacks as a result of Mother Nature doesn’t discourage producers from staying in the industry.
“We really rely upon agriculture and the people who are involved in the industry, so we want them to be able to move forward and keep going.”
In a news release, the government said it hopes the deferral will ease some concerns as producers prepare for an unpredictable winter.
“This year’s growing conditions across several provinces have brought many challenges to Canadian livestock producers,” said Agriculture and Agri-Food Minister Lawrence MacAulay. “The government has prioritized the approval of the livestock tax deferral to give farmers more certainty about their financial situation and help them keep their businesses strong, while growing the economy and strengthening the middle-class.”
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