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Lobby intensifies for cattle tax deferral

“I’d just as soon see this happen sooner rather than later.”

– James Bezan, MP

James Bezan says he is having an uphill battle persuading the federal Finance Department that losing hay to a flood is the same as losing it to a drought.

“It’s a matter of convincing people within the department that the impact of excessive moisture is the same as lack of moisture,” a clearly frustrated Bezan said Dec. 18.

The Conservative MP for Selkirk Interlake is lobbying to have flooded cattle producers in the Interlake and Westlake regions qualify for a tax deferral on their livestock.

The Income Tax Act allows farmers affected by a weather disaster to sell part of their breeding herds and become eligible for a one-year income tax deferral on those sales.

Breeding herds must be reduced by at least 15 per cent. Proceeds from deferred sales can be partially offset by the cost of buying new breeding animals the following year.

The catch is that the deferral applies only in case of drought in designated areas.

In Bezan’s constituency, unseasonably heavy rains this summer prevented many producers from harvesting hay and left the region with a severe livestock feed shortage.

“I’m hoping to have (Finance Minister Jim Flaherty) recognize that as equivalency,” Bezan said.

Agriculture Minister Gerry Ritz is reportedly on side and has also made the pitch to Flaherty.

But even if Finance approves, it’s unclear how the change in policy could be achieved. Bezan himself isn’t sure if it requires a legislative change or just a cabinet order.

A third way would be through a ways-and-means motion in the House of Commons. But that’s not an option because the House has prorogued and won’t reconvene until late January.

Meanwhile, cattle producers are either culling or even liquidating herds they cannot feed, according to reports.

The Manitoba Cattle Producers Association recently sent letters to Manitoba’s 14 MPs demanding they lobby for the necessary changes to the act to qualify flooded farmers for the tax deferral in 2008.

Keystone Agricultural Producers is also calling on Flaherty for the change.

“Producers were hard hit by flooding in the Interlake and other areas and they deserve the same consideration as producers in drought situations,” said Ian Wishart, KAP president.

Ironically, Bezan, who has a cattle farm near Teulon, is in the clear. Since entering politics in 2004, he has overwintered his cows at his brother’s place in western Manitoba, where there’s lots of hay this year.

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