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Manitoba livestock producers get tax deferral

After a season-long struggle, most of agro-Manitoba is eligible for the national livestock tax deferral this year

A feed shortage this year has cattle producers mulling tough decisions come cull time. A recent tax deferral could make those decisions simpler for many.

Manitoba livestock producers may be in line for federal aid if they have to cull.

Much of agro-Manitoba will be eligible for Agriculture and Agri-Food Canada’s livestock tax deferral program this year.

AAFC released its initial eligibility list Sept. 14, stretching from the Municipality of Grahamdale near Lake St. Martin to the Canada-U.S. border and stretching across the province east to west. Only parts of eastern and western Manitoba — including most of the northwest — are not on the list.

“For some of those RMs that have not been deemed eligible, there’s still opportunity for the final assessment to come through after further data is collected and it wouldn’t surprise us to see that some of those RMs that have been left off the initial (list) might actually end up finding their way onto the final assessment list,” Manitoba Beef Producers general manager Brian Lemon said.

The producers’ group noted widespread demand for feed after forage harvests floundered. AAFC requires forage harvest to fall to half or less of its average long-term yield before being named to the program.

AAFC’s finalized list is expected in December.

The tax deferral would allow producers to shift part of their 2018 breeding stock sale to the next tax year, “to help replenish the herd.”

“The cost of replacing the animals in 2019 will offset the deferred income, thereby reducing the tax burden associated with the original sale,” AAFC said in a recent release.

The deferral will apply only to producers who have to cull hard. AAFC requires breeding stock be cut by at least 15 per cent to qualify, at which point producers can defer 30 per cent of that sale. Numbers go up if a cull reaches 30 per cent or more of the breeding herd. For those producers, up to 90 per cent of sale income can be deferred.

“A number of producers who are hoping to be able to manage through the winter and not have to sell off their herds, they’re obviously not necessarily going to be looking for this program because it’s not going to be of value to them,” Lemon said. “It’s those producers who are in the most dire of circumstances who are being forced to liquidate or cull heavier than they would want to and those are the ones who are going to be looking at this program as an option for them.”

Province pitches in

The province’s dismal forage harvest has already prompted intervention from the province, although efforts such as the now-defunct freight programs remain a thing of the past.

As of late August, the province opened up additional Crown lands for grazing and haying.

Lemon welcomed the announcement, although Manitoba Beef Producers expects the program to benefit local producers more than the industry at large.

More recently, the province announced that it would expand programming under Ag Action Manitoba.

Producers can now get funding to drill or deepen wells, construct or repair dugouts, drill test holes or for equipment such as water pumps, casings and well caps, Manitoba Agriculture announced Sept. 14

The province later said that solar- or wind-based watering systems will also be covered under the expansion.

The province slotted the expansion under managing livestock access to riparian areas, one of the fundable practices under Ag Action Manitoba. Projects will be cost shared between the producer and the province, ranging from an even split to 75 per cent of costs borne by the producer. The province has set the funding cap at $60,000 per farm, spread across all of the approved beneficial management practices that farm may pursue during Ag Action Manitoba’s five-year term.

Farms must have an environmental farm plan to access funding.

Lemon hopes that funds will be rolled out in time for winter watering projects this fall.

“As much as feed is an issue, water is going to be a huge concern for producers going into the fall and trying to manage through the winter,” he said.

Manitoba Agriculture had noted increasingly dry dugouts this summer, with reports of farmers moving herds off pasture as early as August due to both the lack of feed and lack of water.

“If producers are able to get approval and get started, even if they’re able to get some sort of assurances that the monies will flow, certainly producers are able to go to financial institutions with that assurance if they need assistance in that regard,” Lemon said.

Producers have until Feb. 15 to give proof of their complete environmental farm plan to access funding. The province says they are accepting beneficial management practices project applications through the fall.

About the author


Alexis Stockford

Alexis Stockford is a journalist and photographer with the Manitoba Co-operator. She previously reported with the Morden Times and was news editor of  campus newspaper, The Omega, at Thompson Rivers University in Kamloops, BC. She grew up on a mixed farm near Miami, Man.



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