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RMs added to national livestock tax deferral

Producers from 17 new RMs may be in line for some tax relief if they are forced to cull this fall

Cattle producers in Manitoba are welcoming the addition of more locations that qualify for the livestock tax deferral program.

Another 17 municipalities will be eligible for the federal government’s livestock tax deferral program (see list at bottom).

Agriculture and Agri-Food Canada had released an initial list of eligible municipalities in September, citing the dry, challenging growing conditions that cut many forage yields in half. That list was expanded Nov. 1 to include western municipalities that had been passed over in the first round of assessments.

Forage must have taken a significant hit, either due to drought or flood, to be named. Municipalities are only eligible for the program if forage yields fall below 50 per cent of the long-term average in that region.

In Manitoba’s case, the cause was drought. Sixty-three municipalities made the cut in AAFC’s initial assessment, covering most of central Manitoba and the Interlake.

Brian Lemon, Manitoba Beef Producers general manager, expressed little surprise at the expansion. AAFC typically releases a second assessment, he said, and his group had written to federal Agriculture Minister Lawrence MacAulay, requesting additional municipalities be considered.

“There were a few RMs along the southwest, along the Saskatchewan border, that hadn’t been included in the first one,” he said.

The producers’ group got its wish Nov. 1. Most of agro-Manitoba is now eligible for the program, with the exception of the northwest pocket — which saw substantial rainstorms in midsummer — and parts of the southeast.

How it works

Producers in those areas who are forced to sell livestock will be allowed to defer a portion of that income into 2019. According to AAFC, that allows producers to reduce their tax burden, since the income will be offset by the purchase of replacement breeding stock.

The program will have little impact for producers making only minor culls. Producers must be cutting their breeding stock by at least 15 per cent to qualify. Farmers cutting between 15 and 30 per cent of their herd will be able to defer 30 per cent of that income, while producers cutting their herd by 30 per cent or more will be able to bump that deferral up to 90 per cent of the net sales.

Producers in eligible regions can request the tax deferral when filing their 2018 income tax returns.

The newly added Manitoba RMs include:

  • Alonsa
  • Clanwilliam-Erickson
  • Ellice-Archie
  • Glenella-Lansdowne
  • Hamiota
  • Harrison Park
  • McCreary
  • Minto-Odanah
  • Oakview
  • Pipestone
  • Prairie View
  • Riverdale
  • Rosedale
  • Sifton
  • Ste. Rose
  • Wallace-Woodworth
  • Yellowhead

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