The organization released research done along with farm accountants on the same day the federal government introduced its motion to increase the inclusion rate from one-half to two-thirds as of June 25.

GGC and nine other organizations previously lobbied to exempt farmers from the increase, announced in the April budget, citing intergenerational transfer as a main concern.

The Canadian Federation of Agriculture said it was frustrated the changes could undermine those transfers and that Ottawa ignored the calls for further work on the planned changes.

“By announcing the proposed tax changes in the federal budget on April 16 with an effective implementation date of June 25, the government of Canada is not providing Canadian farm businesses with enough runway to fully assess the potential implications of these changes for farm succession tax planning purposes and adjust accordingly,” said CFA in a news release.

The increase of the inclusion rate comes with an increase to the lifetime capital gains exemption to $1.25 million.

The organizations worry the inclusion rate change will neutralize that increase and jeopardize farm transfers.

“By ramming these very significant tax changes through while farmers are in the field planting, we aren’t giving producers enough time to fully assess the implications for their families and their businesses,” said president Keith Currie.

The tax measures are expected to add about $19 billion to federal coffers. Ottawa says provinces also stand to benefit from more than $11 billion.

The GGC research said the inclusion rate change affects farmers’ retirement plans and threatens the long-term viability of family farms across the country.

It found an 800-acre farm bought in 1996 in Ontario would have to pay almost $1.2 million in additional taxes if sold today. A 4,000-acre farm in Saskatchewan would see an increase of more than $900,000 in tax costs.

“With over 40 per cent of farmers nearing retirement over the next decade, this tax increase introduces substantial uncertainty into their retirement planning,” said Andre Harpe, GGC chair and an Alberta grain farmer. “Despite Budget 2024’s title of ‘Fairness for Every Generation,’ this change will actually burden the next generation of farmers, who are already grappling with costly transfers.”

The research also included a joint-ownership case study, using a 2,500-acre Alberta grain farm. Even with two lifetime capital gains exemptions, the taxes on capital gains will rise 29 per cent, or more than $1 million, the document said.

GGC said farmers are often asset rich but cash poor, and they regularly upgrade and expand their operations and equipment.

“A 30 per cent increase in taxes on the family farm also dramatically increases the cost of farms, pricing out many families. This puts the family farm at risk, as the only ones that will be able to afford to pay millions of extra dollars will either be corporate farms or development companies,” said GGC executive director Kyle Larkin.

GGC said Statistics Canada shows a two per cent decrease in family-owned farms between 2016 and 2021. Leaving the inclusion rate where it is could help protect families, it said.

The Canadian Cattle Association and the Canadian Cattle Youth Council also called for implementation to be halted until the matter could be fully studied.

“Our producers and accountants have not had enough time to properly assess the magnitude of implications these changes will have on the beef industry. We urge the government to press pause on this implementation and have discussion (on) the impacts with farmers more fully,” said Nathan Phinney, CCA president. CCA asked to hear from farmers about how the changes will affect them.

The Canadian Chamber of Commerce is among those who oppose the changes.

Meanwhile, in the House of Commons, the motion passed 208 to 118; the NDP and Bloc Quebecois members voted with the government while the Conservatives voted against it.

Conservative leader Pierre Poilievre said higher taxes will hurt the economy and consumers while the Liberals say the issue is tax fairness. He called for emergency finance committee meetings to study the issue.

“In two weeks’ time Justin Trudeau will hike taxes on homebuilding during a housing shortage. He will raise taxes on doctors during a doctor shortage. He will hike taxes again on farmers during a food cost crisis and on small business as Canadians’ paycheques are shrinking,” Poilievre said.

Draft legislation will follow the motion but it isn’t expected to be substantially different.

The post Capital gains changes continue to draw farm concerns appeared first on Manitoba Co-operator.

The provincial budget, tabled April 2, included a reworked rebate, pitched by the provincial government as an affordability measure for lower income Manitobans. The budget erased the rebate for commercial properties “in anticipation of the introduction of a new education funding model,” tinkered with the credit’s thresholds in residential categories and introduced a $1,500 Homeowners Affordability Tax Credit, but the school tax rebate for farm properties was not affected. It remains at 50 per cent.

Why it matters: The April 2 budget is the first tabled since the NDP dethroned the Progressive Conservatives in last fall’s election.

Keystone Agricultural Producers welcomed that news. “We encourage the province to continue working toward the complete removal of the tax on farm properties and that this is taken into account when developing the new provincial education funding model,” KAP general manager Brenna Mahoney said.

Farmers had previously been promised a phase-out of educational property tax on their properties under the previous government.

Offices to return

The province also aims to reopen two rural Manitoba Agricultural Services Corporation (MASC) centres this year, something promised during the NDP’s electoral campaign last year.

A total 13 offices were closed in 2021, leaving 10 operational. The government of the day said the move was an effort to modernize and consolidate agricultural services in the province.

The 2024 budget allocated $200,000 to reopen the first two service centres. Premier Wab Kinew linked the line item to attempts to reverse some of the centralization of government services that has occurred in recent years. “We’re very excited about this,” he said. “We think that decentralizing these services ensures not only that there is a MASC service center, but also the economic activity that comes along with that, the rent that’s being paid and the employment position(s) created.”

Sites for the two new centres have yet to be determined, but Kinew said the plan was to establish them within the calendar year.

“We’re going to set to work under the leadership (of) Minister Kostyshyn to figure out where the best fit is for those locations,” he said. “We’ve heard some lobbying and helpful suggestions so far and we expect that there’ll be a few more helpful suggestions before we land on the final selection.”

Livestock initiatives

Several other budget items are aimed at livestock producers.

The province announced increased funding to create, retain and attract veterinary medical professionals to rural areas. Other promises include freezing rent rates for Agricultural Crown lands and the launch of a livestock predation prevention strategy.

The Crown land rate freeze cements cuts promised late last year. The province had pledged that 2024 rents would sit 55 per cent below the amount calculated under Crown land regulations. The previous government had halved rates for 2023, citing production challenges in recent years.

A three-year pilot program gauging prevention methods against predation also recently wrapped up.

The Manitoba Beef Producers highlighted the livestock-specific budget items.

Lack of large animal veterinarians, meanwhile, has been a perennial concern in Western Canada. Organizations such as MBP and the Association of Manitoba Municipalities have flagged critical vet shortages in rural regions and have lobbied for various measures to fill the gap.

“MBP has done considerable advocacy work on matters like these given their importance to our members, so seeing them singled out in the budget is important,” MBP president Matthew Atkinson said in a news release.

The budget sets aside $135,000 to address the shortage of veterinarians in rural Manitoba. The funding includes tuition rebates for students trained at the Western College of Veterinary Medicine (WCVM), and funding for five additional seats within the VetSTEP summer work program for WCVM students, with a focus on commercial animals.

“KAP is excited to see $135,000 announced in this budget that will go toward the implementation of the veterinary strategy, which we developed in partnership with the team at Manitoba Agriculture,” said Mahoney.

MBP general manager Carson Callum noted a number of positive elements in this year’s budget. But while he welcomes the incoming predation strategy, “We’d like more clarity on what that fully entails,” he said.

The recently completed project, dubbed the Livestock Predation Prevention Pilot, set a foundation of knowledge on the topic. “We look forward to seeing what other steps can be taken to reduce interactions and reduce losses on farms,” he said.

Another line item in the 2024 budget notes that the province will be providing $5.2 million for “Wildlife Damage Compensation to compensate producers for losses sustained through crop damage and livestock predation.”

The province also announced increased funding for business risk management programs and boosted eligible loan amounts for the young farmer rebate from $200,000 to $300,000 and the lifetime maximum rebate from $20,000 to $30,000. The young farmer rebate is available through MASC and targets farmers under the age of 40 to provide assistance during the start-up phase of their business.

“These components of Budget 2024 are welcomed by Manitoba producers across the province,” KAP president Jill Verwey said. “In particular, the lending fee credit through MASC for farmers under 40 will provide significant benefits to the next generation of farmers.”

Municipal concerns

Items of more general rural interest included restoring the rural doctor recruitment fund and increasing policing grants available to municipalities.

The province’s budget document was heavy on health care.

“The announcements with health care will benefit all Manitobans,” said Association of Manitoba Municipalities president Kam Blight. “And there’s a specific rural touch to some of it.”

Blight called the restored recruitment money “excellent news” and also noted a commitment to improving rural medical transportation.

“The $22 million to help with medical transportation in rural areas is absolutely critical,” he said.

The province also provided a two per cent escalator to municipal funding, but Blight said AMM would have liked to see more. Funding and inflationary pressures were a common theme within resolutions presented at the AMM’s last annual meeting last fall.

“We’re pleased to see that our operating and strategic infrastructure funding baskets are going up by two per cent,” he said. “But it does fall short of the rate of inflation. There’s still some work to be done there to make sure it’s long term and predictable.”

Blight said the province has told him they are committed to work with the AMM to achieve that.

“There’s a lot of small victories in there that we’re very pleased to see, and we’re very appreciative of, but there wasn’t a lot of surprises,” he said.

The budget, however, falls short in addressing rural crime, Blight said.

“Greater steps to be taken towards addressing that issue, especially when one of the campaign promises this government has been saying is that they’re going to be tough on crime. We’re not seeing that in this budget.”

Blight argued that the increase to policing grants is just re-establishing funding that had been in place previously.

“There’s really new money’s being put towards public safety and that’s where the concern lies for us,” he said. “We’re going to continue to have these conversations and really push this issue with the province of Manitoba.”

Blight also felt that water and wastewater infrastructure funding was not adequately addressed.

The provincial budget did include funding for water and wastewater services, including a $4-million increase for the Manitoba Water Services Board to address “Manitoba’s water and wastewater infrastructure deficit,” but Blight said that money is only enough to maintain the current level of service.

“There needs to be a greater increase,” he said. “It’s hurting residential development and is deterring and turning away economic growth.”

Blight said he is hopeful that shortfall will soon be corrected by the province.

“We will continue to work with the province on this issue and continue to help them better understand the challenges we’re facing,” he said.

These kind of infrastructure discussions will also have to involve the federal government, he noted, “but we’re ready to get to work on this again.”

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“We need to see more,” said Brandon Mayor Jeff Fawcett in a Sept. 20 news release. “Building and maintaining core infrastructure – from water and wastewater to broadband – is a priority for all municipalities and this hasn’t received enough attention in this campaign.”

Why it matters: Manitobans head to the polls Oct. 3.

Fawcett, along with Winnipeg Mayor Scott Gillingham, Portage la Prairie Mayor Sharilyn Knox and Association of Manitoba Municipalities president Kam Blight, spoke to reporters at a news conference in Brandon Sept. 20.

The local leaders emphasized AMM’s election priorities and recapped what the three major provincial parties have said on those issues thus far.

Those four main priorities are: fair and predictable municipal funding; investment in core infrastructure; investment in people (such as job training, especially for healthcare workers); and public safety.

Gillingham told reporters that municipal funding is “the most urgent and important priority for municipalities. Everything else flows from that.”

READ MORE: College’s sustainable ag centre draws campaign commitments

Provincial funding transfers to municipalities were capped from 2016 to 2022, he said. The Progressive Conservative government lifted the freeze in this year’s budget, which Gillingham called “real progress.”

However, municipal governments need a new funding format in the future that will grow automatically as populations or local economies expand and that will index to inflation, he added.

The PC, NDP and Liberal parties have all told the AMM that they will at least consider municipal input on the funding model, Gillingham said.

On infrastructure, Manitoba’s municipalities are “displeased with the degree of attention to core infrastructure funding” in the campaign, AMM said in its news release.

The party platforms contain multiple promises related to infrastructure.

The NDP have included a pledge to “reverse the PCs’ cuts and invest in highways, bridges, roads and maintenance.” The PC election promises include $2.5 billion for highways over the next five years. The Liberals promise to repair “highways, provincial roads, bridges and intersections,” prioritizing those projects in consultation with the AMM.

The association said it expects more discussion on how parties will address infrastructure needs.

However, municipal leaders are pleased that all parties have seen the need to attract and train more health-care workers, AMM said in the release.

It also acknowledged that all three parties have discussed ways to address crime rates. Knox cited an AMM survey from this June that showed 56 per cent of Manitobans feel “less safe” in their communities than they did three years ago.

“Different parties have offered different detailed commitments on how they would address crime, and all have merit; the essential point is that this has emerged as a consensus provincial priority,” AMM said Sept. 20.

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Finance Minister Chrystia Freeland’s budget, released Tuesday, laid out a list of investments to “further strengthen Canada’s transportation systems and supply chain infrastructure.”

A non-financial line item in that envelope calls for the government to introduce amendments to the Canada Transportation Act for a “temporary extension, on a pilot basis” of the interswitching limit in the Prairie provinces, to “strengthen rail competition.”

Interswitching rules commit one rail carrier to pick up cars from a shipper, then deliver them to another railway for the line haul. Federal rules generally allow grain elevators and other shippers to use interswitching for up to a 30-km radius.

Expanding that maximum radius, the feds said Tuesday, “would support competition among rail carriers by enabling rail companies to access tracks owned by another rail provider within the limit, under rates regulated by the Canadian Transportation Agency.”

The previous Conservative government set up a temporary extension of the interswitching radius, to 160 km, in 2014, to the acclaim of several crop commodity groups — but that extension was sunsetted in 2016.

The Railway Association of Canada said Wednesday the 2014 extension was allowed to lapse “based on results from a previous pilot and recommendations contained in an independent study” — a reference to a 2015 review of the Canada Transportation Act.

The RAC, which represents almost 60 railways in Canada including Canadian National and Canadian Pacific railways (CN, CP), ripped the current Liberal government’s proposal as a resurrection of a “failed policy” that was “misguided and harmful to Canada’s supply chains.”

“This policy will cause Canadians to pay more for virtually everything that moves by rail,” RAC CEO Marc Brazeau said Wednesday in a release, warning the policy “will incentivize congestion in our supply chains while disincentivizing private investment.”

“This pilot has been done before,” the RAC said, listing the impacts of “switching cargo multiple times” as slowing the movement of goods by one to two days, adding to greenhouse gas emissions and adding costs.

“The measures announced today will not improve the efficiency, capacity or reliability of Canada’s supply chains. They will do the exact opposite, as we saw under extended regulated interswitching that was in place from 2014 to 2016,” Brazeau said.

However, supporters of the 2014 extension estimated in 2016 that about 150 grain elevators on the Prairies were able to make use of interswitching with the 160-km radius, up from just 14 elevators previously.

One such supporter, Pulse Canada, in 2016 said freight rates were reduced on some routings, and that grain shippers were afforded more leverage in getting rail car capacity where needed, both as a result of the extended interswitching radius.

Gordon Bacon, Pulse Canada’s then-CEO, speaking in favour of extended interswitching in 2016, said that “in cases where railways have lost business due to competition, they are actively campaigning to get it back by offering rate reductions and improved levels of service.”

‘Down payment’

The RAC on Wednesday also panned another non-financial proposal from Tuesday’s budget — namely, for legislation that would ban the use of temporary replacement workers in federally regulated workplaces affected by work stoppages.

The RAC said a ban on replacement workers would mean rail service “will be disrupted more frequently,” strikes “will be more common and will last longer” and federal back-to-work legislation “will be required more often.”

Tuesday’s budget also earmarks $27.2 million over five years starting in 2023-24 for Transport Canada to establish a “Transportation Supply Chain Office.”

That office, the budget said, would “work with industry and other orders of government to respond to disruptions and better co-ordinate action to increase the capacity, efficiency, and reliability of Canada’s transportation supply chain infrastructure.”

The budget noted the measures announced Tuesday “are a down payment on Canada’s National Supply Chain Strategy,” which the government said “will be released in the coming months and will be informed by the recommendations of the National Supply Chain Task Force report.” — Glacier FarmMedia Network

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Freeland’s 2023 federal budget, released Tuesday, includes $13 million in 2023-24 for Agriculture and Agri-Food Canada to temporarily increase the interest-free limit for loans under its Advance Payments Program (APP) to $350,000 for the 2023 program year.

The interest-free portion of an APP loan was previously capped at $100,000 but that level was temporarily raised last summer to $250,000 for the 2022 and 2023 program years.

The APP provides farmers with cash advances of up to $1 million, based on up to 50 per cent of the anticipated market value of a farm’s eligible production, whether it’s still to be produced or is already stored.

“Farm production costs have increased in Canada and around the world, including as a result Russia’s illegal invasion of Ukraine and global supply chain disruptions,” Tuesday’s budget documents said. “It is important that Canada’s agricultural producers have access to the cash flow they need to cover these costs until they sell their products.”

On that note, the budget also committed the feds to “consult with provincial and territorial counterparts to explore ways to extend help to small agricultural producers who demonstrate urgent financial need.”

Fertilizer funding

On the matter of input costs, the budget also notes Russia’s invasion of Ukraine “has resulted in higher prices for nitrogen fertilizers, which has had a notable impact on eastern Canadian farmers who rely heavily on imported fertilizer.”

To that end, the budget proposes a $34.1 million addition to the federal On-Farm Climate Action Fund over three years, specifically “to support adoption of nitrogen management practices by eastern Canadian farmers, that will help optimize the use and reduce the need for fertilizer.”

That $34.1 million figure roughly coincides with a recent estimate of the tariffs collected so far on imports of Russian fertilizer into Eastern Canada. Several grower groups in that region have called for an end to that tariff and for farmers to be directly reimbursed for tariffs already paid.

Dairy development

Among other longer-term investments, the budget proposes $333 million over 10 years to set up what it calls the Dairy Innovation and Investment Fund, starting in 2023-24, to back development of new dairy products based on solids non-fat (SNF), a dairy processing byproduct.

The dairy sector is up against “a growing surplus” of SNF, for which the limited processing capacity in Canada “results in lost opportunities for dairy processors and farmers,” the budget said.

The new fund would support “investments in research and development of new products based on SNF, market development for these products, and processing capacity for SNF-based products more broadly.”

Inoculation inventory

The budget also pledges $57.5 million over five years starting in 2023-24, and $5.6 million ongoing, for the Canadian Food Inspection Agency to set up a foot-and-mouth disease (FMD) vaccine bank for Canada and develop FMD response plans.

Recent outbreaks of FMD in livestock in Asia and Africa “have increased the risk of global spread,” the budget said, and if an FMD outbreak were to occur in Canada it “would cut off exports for all livestock sectors, with major economic implications.”

The impact of a potential FMD outbreak “would be significantly reduced with the early vaccination of livestock,” the budget said. For the vaccine bank, the feds plan to “seek a cost-sharing arrangement with provinces and territories.”

The Canadian Cattle Association on Tuesday hailed the vaccine bank announcement, describing a vaccine bank as a “critical” investment which “helps provide necessary insurance to protect Canada’s export markets.” Several livestock groups have called for such an investment in recent years.

“While we hope this vaccine bank is never needed, we are grateful for today’s investment and its establishment,” CCA president Nathan Phinney said in a separate release. “We appreciate the government listening to our concerns and understanding the critical need to put in place emergency preparedness plans to control the spread of the disease and protect our export markets for Canadian beef.”

Risk management

CCA also hailed a separate budget line item pledging $184 million over three years to boost the Species At Risk Act. That funding goes to the federal environment, parks, fisheries and natural resources departments “to continue monitoring, protecting and promoting the recovery of species at risk to help restore their populations.”

“We will be engaging with the government of Canada to ensure beef producers are at the table as key stewards of lands where species at risk live,” the CCA said.

On that matter, noting cattle producers’ stewardship work on endangered native grasslands, Phinney said the CCA calls on Ottawa “to include support for protecting Canada’s grasslands in the future.”

Liquor and cannabis

Among federal sin taxes, the feds propose to temporarily cap the inflation adjustment for excise duties on beer, spirits and wine at two per cent, for one year only, as of April 1. Alcohol excise duties are usually automatically indexed to total Consumer Price Index (CPI) inflation at the beginning of each fiscal year.

The feds also announced plans to allow all licensed Canadian cannabis producers to remit excise duties on a quarterly basis rather than a monthly basis, also starting April 1. That move expands on a measure put in place for “certain smaller” cannabis producers in the 2022 budget.

On that note, the budget said, “while significant progress has been made in eliminating criminal activity in the cannabis market, licensed cannabis producers are currently experiencing financial difficulties as they help to build a stable, legal cannabis industry in Canada.” — Glacier FarmMedia Network

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The increase in education property tax rebates was part of the 2022 provincial budget, and was welcomed by farm and municipal leaders. The Manitoba School Boards Association says divisions are struggling under frozen funding.

“We agree that education property taxpayers, certainly our farmers and our producers, they pay too much when it comes to funding the education system,” said Alan Campbell, president of the Manitoba School Boards Association.

However, the province is “phasing out education property taxes, and they’re freezing school boards’ abilities to increase at the same time as provincial funding decreases for many divisions,” Campbell said.

In the 2022 budget, the province upped the education property tax rebate for residential and farm properties to 37.5 per cent, up from 25 per cent in 2021.

Other properties, like business and industrial lands, will receive 10 per cent rebates.

For the second year of the education property tax phase-out, total education property tax revenue remains frozen at the 2020 assessed amount.

This means despite rising property values, school divisions’ revenue remains the same, Campbell said.

Meanwhile, “provincial funding has failed to keep up with inflation for years and years,” he said.

Education property taxes make up a large portion of many divisions’ revenue, Campbell said. The province has said it will replace schools’ property tax revenue with funding from general revenue, but Campbell said they’re yet to receive details on how that will work.

Campbell, who is on the board of the Interlake School Division, said his schools have been forced to make budget cuts in excess of $2.5 million in the last two years — their budget is about $40 million.

This has meant cutting staff positions, cancelling junior kindergarten and adult education, and not replacing aging buses. They’ve reached a point where they can’t make any more cuts without affecting the classroom, Campbell said.

For years when provincial funding fell short, they’d supplemented with local revenue, but that’s no longer possible, he added.

In February, the province announced it had formed a “funding model review team” and would be developing a new education funding model.

Campbell said the Manitoba School Boards Association was participating in that review and they hoped to have that model in place in time for the next fiscal year.

He added that he’s optimistic about the government’s new tone.

National Farmers Union board member Ian Robson said he was also concerned about the province’s funding of education, calling it key to maintaining an agricultural workforce.

“We need educated students,” he said. “We need more young people taking up farming, but we’re not raising enough of our own.”

Keystone Agricultural Producers noted the increase to the tax rebate was not as high as telegraphed last year.

In 2021 budget documents, the province said it intended to increase the rebate to 50 per cent in 2022, adding the increase would be reviewed in next year’s budget.

“We were hoping for the 50 per cent this year but that is not realistic at this time,” said KAP general manager Brenna Mahoney. “We are pleased to see that they are committing to the 10-year reduction and removal of the education property tax.”

Municipalities feeling the pinch

The Association of Manitoba Municipalities praised several changes to funding and programs of interest to municipalities, including $9 million in dedicated funding for the Green Teams program, up from $5 million; and increased the ceiling of $25 million from $10 million for the Building Sustainable Communities Fund; and over $2.4 billion in promised strategic infrastructure investments in 2022 through 2024.

KAP also praised the province’s commitment to highway infrastructure.

At a municipal road level, said AMM president Kam Blight, “We have a lot of infrastructure to maintain, and the costs continue to rise so naturally we’re always looking for funding supports.”

Robson added roads and bridges are suffering “pretty badly” as budgets are “under duress.”

Municipal governments are feeling pinched as the funding freeze on operating grants from the province remains in place for another year, said Blight.

“To see that stay frozen for the seventh year in a row was very difficult for us to hear,” he said.

Many municipalities had extra costs because of the pandemic, and costs have risen since 2016, Blight said. Some municipalities have had to raise taxes, cut services, or both.

AMM was also hoping for some pandemic-related relief funds from the province, Blight said. Municipalities have lost millions in revenue during periods of pandemic health restrictions, largely due to closures of rec facilities, he said.

“Those are huge losses that we’re trying to absorb,” he said.

Blight said if the province would grant AMM’s long-standing ask for either a rebate of PST, or an exemption, this would amount to about $25 million back to municipalities. That alone would go a long ways towards filling the gap.

“Municipalities firmly believe that one level of government should not be taxing another level of government,” he said.

Climate and conservation

Nods to climate and conservation included an increase to $1.5 million from $1 million for Manitoba’s Conservation and Climate Fund — cash for grants toward projects to reduce emissions and address the effects of climate change.

Documents noted an Energy Policy Framework and Water Management Strategy were under development.

The budget also mentioned “working collaboratively with Canada” to assess and implement carbon pricing in a way that suits Manitoba’s economy and priorities.

It’s “pretty lightweight,” said Robson. “There’s not very much planning in terms of the climate.”

The NFU wanted to see more funding towards reducing emissions in agriculture — as well as other sectors, said Robson, as well as more support for watershed districts.

The post More money back in farmers’ pockets, but schools struggling with frozen funding appeared first on Manitoba Co-operator.

In its 2022-23 budget, released April 12, the Manitoba government pledged to increase rebates for farm and residential properties to 37.5 per cent from 25 per cent.

In the 2021 budget, the province had intended to increase the rebate to 50 per cent in 2022, but would review that amount during future budgets.

The move will cost the province over $100 million in revenue, budget documents say.

Keystone Agricultural Producers (KAP) welcomed the announcement.

“The announcement of increasing the Education Property Tax Rebate to 37.5 per cent for 2022 and 50 per cent for 2023 is welcome news for Manitoba farmers”, said KAP president Bill Campbell in a statement. “KAP will continue to lobby for the complete removal of the education property tax from all farm property.”

Manitoba’s National Farmers Union (NFU) was less optimistic.

“That’s an indication that rural schools should be very concerned,” said Ian Robson, a NFU board member for Manitoba.

The NFU opposed the education property tax rollback because of concerns it would leave the education system poorly funded and that kids’ education would suffer, according to an April 2021 op-ed.

“We need those kids in rural areas,” Robson said. “We need more farmers and not fewer farmers.”

Education property tax revenue also remains frozen at a 2020 amount, budget documents say.

In its 2021 budget, the province promised education funding would not drop despite the rollback on taxes and alluded to paying the deficit out of general revenue.

The province will bump up spending on the Department of Agriculture to $495 million from a budgeted $367 million last year.

The department ran over budget by an estimated $454 million last year “due to higher claim payouts as a result of the 2021 drought.” This will be partially offset by an increase in revenue, the province said.

KAP also praised the province for a capital investment of “much needed funding” into highway infrastructure.

In a new “Three Year Capital Plan,” the province pledged investment into key trade and commerce routs, pinpointing the rehabilitation of Provincial Trunk Highways 23 and 5, and enhancements to St. Mary’s Road (Provincial Road 200) and McGillivray Boulevard (PTH 2) interchanges.

The budget also includes a $111 million investment in roads and highways through the Manitoba Restart Program, which was announced in the 2020 budget. In total, capital investment into Highways, Infrastructure and Airport Runways is slated at nearly $474 million this year, up from $404 million last year.

Manitoba’s Conservation and Climate fund will increase to $1.5 million from $1 million in 2021. The fund supports projects to reduce greenhouse gas emissions, promote sustainable development and address the effects of climate change. 

“Interest in the merit-based program has increased since its launch and the growing portfolio of projects are helping to advance Manitoba’s core climate objectives,” budget documents say.

Robson noted that yet more effort should go into climate issues—for instance, projects to promote soil organic carbon.

Blowing soil he saw during winter illustrates the need for promotion of cover crops and poly crops, he added. Farmers are already doing these things on their own dime, he said, but “these kinds of things need more encouragement.”

KAP praised investments into childcare—part of implementation of a federal-provincial deal to open up more early learning and child care spaces and to support an average of $10 per day care.

“Access to affordable and accessible childcare in rural areas has been an ongoing concern for young Manitoba farmers,” said Campbell.

KAP also said in light of the current labour shortage, it supports a $5 million investment to attract newcomers to the province. It added KAP looks forward to insights from the new Manitoba Immigration Advisory Council, which it said it hopes will lead to additional investments in labor and immigration.

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The province said Wednesday in a budget release that a “number of clarifications” will be made to its Provincial Sales Tax (PST) Regulations effective April 1 relating to “farming and agriculture activities.”

Noting such lists are reviewed each year, a finance ministry spokesperson said Thursday the changes being made are “relatively small” in terms of reduced provincial tax revenue, at about $1 million per year.

The list of items and activities to be specifically included in the list of on-farm PST exemptions starting April 1 are expected to address concerns raised by producers over what they viewed as “PST creep.”

The province thus consulted with ag groups on what their members viewed to be “unfair or inconsistent” application of PST.

“While not significant in dollar value, these changes will clear up a number of issues included on these lists,” the ministry spokesperson said via email.

Items, services and activities to be specifically listed as PST-exempt for on-farm use starting April 1 include:

• corral slabs and windbreaker panels;
• insulators for electrified cattle fences;
• portable seed cleaning equipment, if used on-farm and not by for-profit operators of mobile custom seed cleaning services;
• certain chemical storage tanks and water storage tanks;
• crawler tractors, if to be used on-farm and not in the construction sector;
• on-farm digging of dugouts; and
• on-farm trenching for “certain irrigation and electrical purposes.”

The updates to the PST code will also further clarify the exemption for “certain farm equipment attached to a registered vehicle,” the ministry said.

The ministry said it also plans to start discussions with the goal of “modernizing” the agriculture and farming sections of the Provincial Sales Tax Act.

Those changes, the ministry said, may “potentially be considered by the government as part of the 2023-24 budget development cycle.” — Glacier FarmMedia Network

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Provincial Finance Minister Donna Harpauer on Wednesday released her 2022-23 budget with $17.6 billion in expenditures on $17.2 billion in revenues, for an expected deficit of $463 million, well down from the province’s forecast deficit of $2.185 billion for 2021-22.

The province said its budgetary appropriations and expenses for the agriculture ministry come in at $462.4 million, up 19.5 per cent from 2021-22, on “strong 2022-23 crop insurance program and record agriculture research funding.”

The 2022-23 budget’s broader agriculture-themed expenditures come in at $1.04 billion, up 18.3 per cent from the 2021-22 budget of $879.3 million, primarily due to “higher projected crop insurance indemnities as a result of higher crop prices, as well as higher reinsurance premiums.”

However, that estimate is well down from the province’s latest forecast for those 2021-22 ag-themed expenditures, at $3.19 billion, due mainly to last year’s drought-related crop insurance payouts and AgriRecovery program costs.

New line items relating to agriculture this year include $475,000 to set up a new Crown corporation, to be called the Saskatchewan Indigenous Investment Finance Corp.

The new Crown is expected to offer up to $75 million in loan guarantees on private-sector lending to Indigenous communities and organizations for investments into “natural resource and value-added agriculture projects,” the province said.

The province will also further backstop major value-added ag projects through “enhancement” of the Saskatchewan Value-added Agriculture Incentive (SVAI), a 15 per cent tax credit in place since 2018 on capital expenditures of at least $10 million toward newly constructed or expanded value-added ag facilities.

Retroactive to 2018, eligible projects will still get the 15 per cent rebate on the portion of a project’s expenditures up to $400 million, but could also get 30 per cent on the portion between $400 million and $600 million, and 40 per cent on the portion in excess of $600 million. The dollar value of the tax credit will be capped at $250 million.

Examples of qualifying projects include canola crush facilities, pea protein processors, oat milling operations, malt producing operations, and cannabis oil facilities, the province said.

The SVAI and other incentives are “key to Saskatchewan’s competitiveness, attracting private investment from global companies like BHP, Richardson International, Viterra, Ceres Global Ag, Cargill, Federated Co-operatives, AGT Foods, Paper Excellence and Red Leaf Pulp,” the province said Wednesday.

The province on Wednesday also noted that starting April 1 this year, certain “clarifications” will made to provincial sales tax (PST) related to farming and agriculture activities — for example, confirming a PST exemption for the “on-farm digging of dugouts.”

Revenues

On the taxation side of the ledger, the province announced Wednesday it will make “minor changes” to its education property tax (EPT) mill rates for this budget year, “asking residential (and) agricultural as well as commercial and resource property owners to pay slightly more EPT on average.”

For agricultural properties, that 2022 EPT mill rate will rise to 1.42 from 1.36, while residential property EPT mill rates will rise to 4.54 from 4.46.

Harpauer said Wednesday the province’s improved revenue forecast is based on increased revenue from taxes at $8.1 billion, up $850 million from 2021-22 — but also on non-renewable resource revenue at $2.9 billion, up by $1.6 billion from 2021-22.

That increased resource revenue, she said, is “largely due to higher potash and oil price forecasts, which is the result of stronger than expected global demand.”

While crude oil values have been on an upslope for months, they recently leaped higher following Russia’s invasion of Ukraine, as economic sanctions imposed by other countries limit Russia’s involvement in energy markets.

Potash prices have also climbed due to fresh sanctions limiting exports from both Russia and Belarus, the world’s No. 2 and 3 potash-producing countries behind Canada.

“It’s too soon to tell if oil prices will remain high for an extended period and what impact that could have on revenues,” Harpauer said, adding that “because resource prices are so volatile, our government has set a goal of reducing our reliance on resource revenues.” — Glacier FarmMedia Network

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“If we want Canadian agriculture to be more economically and environmentally sustainable, we must break down the barriers for hard-working women in the sector,” said Marie-Claude Bibeau in a panel discussion April 27.

The federal government promised ambitious support and funding for childcare in Canada as part of its 2021 budget. It promised $30 billion to fund, and work with provincial and Indigenous governments to develop, a Canada-wide early-learning and childcare system.

Most details remain to be seen, but the government said it will reduce parents’ fees by 50 per cent, on average, with a goal to reach an average $10-per-day fee by 2026.

Bibeau spoke with MariJo Patiño, secretary and treasurer for Manitoba Women in Agriculture and Food; Miriam Sweetnam, board member with Dairy Farmers of Manitoba; Catherine Kroeker-Klassen, chair of Manitoba Egg Farmers; Sam Connery-Nichol, who co-owns Connery’s Riverdale Farms near Portage la Prairie; and Anastasia Fyk, a Manitoba board member with the National Farmers Union.

“There are few options, especially in rural areas and due to distance, affordability, childcare should also be flexible and offer more options such as part time and drop-off,” said Patiño.

“And at the same time, options for childcare are not enough,” she said. “They need to be a safe place and they need to be well instructed in order to give women the peace of mind to go to work.”

“I need evening hours, and weekend hours, and certain crops like asparagus I’m going 24-7,” said Connery-Nichol. “Then other times I can be home with him and I don’t really need that space.”

“Before the COVID-19 pandemic, women in agriculture already faced difficult challenges balancing responsibilities and expectations tied to their jobs and families,” Bibeau said in a statement on April 21.

“We all know that many women are forced to quit jobs or stop work on the farm because they don’t have childcare support. COVID-19 has exacerbated these pressures and unfairly affected women in Canada and forced many female farmers into these sacrifices,” she said.

Bibeau also told the April 27 panel she was working to see if the temporary foreign worker program could be expanded to include childcare as an eligible farm task. She said this is under consideration, and would make sure women in agriculture were consulted on this.

The NFU said it was pleased to see steps taken toward a universal childcare program, it said in an April 19 statement.

“Life for many rural families has been especially challenging during this pandemic. Many of us work off farm to support our families in addition to farming,” said Coral Sproule, NFU women’s vice-president.

“With children home from school more often, it has meant some of us had to quit off-farm jobs or work a second job from home without childcare.”

The NFU added further support for rural education and rural internet access is also needed.

“While we are pleased to see financial allocations for childcare in today’s budget, we see this as only the first step toward more equitable support for all Canadian families including rural and farm families during this critical time,” said Bess Legault, NFU women’s president.

Childcare researcher Susan Prentice said she walked on air the day the announcement was made, despite this not being Canada’s first attempt at a national childcare plan.

She said she thinks this time the penny has dropped and people realize this is needed.

“I actually do think that it’s going to get done,” Prentice said.

However, she gave a word of caution to Manitobans.

“Manitoba’s stubborn insistence that the market is the way to go really, I think, jeopardizes Manitoba’s ability to participate in this national plan,” Prentice said.

Bibeau acknowledged the program would need to be developed in partnership with provincial governments while speaking to media after the April 27 panel discussion.

She said a combination of wide community support and the federal money on the table would make provincial governments think twice about saying no.

She said a strong commitment within the Liberal government gave her confidence this attempt at nationwide childcare would succeed.

“We had the choice between different major social measures and after, you know, really consulting widely we have decided that this one is the one to make a significant difference in different ways,” she said.

“In the short, medium and long term we strongly believe it’s the best measure we could put in place to help families across Canada while helping the economy as well,” she added.

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