By J.W. Schnarr
Beef producers in the Municipal District of Taber are able to take advantage of the Livestock Tax Deferral provision in 2015.
During their regular meeting on July 28, M.D. council addressed what Reeve Brian Brewin described as “some concern” that the M.D. of Taber was not a designated region listed for 2015 as part of the program.
“There was some concern that the M.D. of Taber was not included in this, but we’re there,” said Brewin, adding he had fielded some calls from concerned residents asking about the program.
The provision allows producers who sell part of their breeding herd due to drought or excessive moisture and flood conditions to defer a portion of their sale proceeds to the following year as a form of protection against feed shortages. The goal is to reduce stock during the year when hardship occurs, but maintain the ability to replenish stock the following year.
Brewin said there are two main issues beef producers are dealing with in the area.
“It’s a combination of two issues,” said Brewin. “Right now it’s the drought, and the grass, and number two is the price of hay.”
“And the high price of cattle,” Deputy Reeve Dwight Tolton added.
In order to take advantage of the provision, the breeding herd must have been reduced by at least 15 per cent. Thirty per cent of the income generated from net sales can be deferred if the breeding herd has been reduced by 15 – 30 percent, and if the herd is reduced by more than 30 per cent, 90 per cent of income generated from net sales may be deferred. In cases where the conditions persist over several years, those deferrals may be held over until the first year the designation ends in the region.
Deputy Reeve Dwight Tolton said he was in favour of the program.
“It’s good management,” he said.
Regions involved in the provision are from British Columbia, Alberta, Saskatchewan, and Manitoba.
According to the federal government, 60 per cent of the prairie Ag landscape has received “very low” to “record low” precipitation. The area represents 27,000 farms and more than 5.8 million cattle.
The federal government also provides assistance through business risk management programs, including the Advance Payments Program to access low interest guaranteed loans of up to $400,000. The interest on the first $100,000 is paid by the federal government, which could be helpful for producers looking to purchase feedstocks.
The current list of regions where the Livestock Tax Deferral provision is in effect is updated regularly as situations change. For more information on the Livestock Tax Deferral provision, please visit the Agriculture and Agri-Food Canada website at http://www.agr.gc.ca and type “Livestock Tax Deferral” into the search bar on the right side of the screen.