Extreme weather conditions have been all too common for livestock producers in the past year, and today the Government of Canada has released its initial list of regions where a livestock tax deferral is authorized for this year.
Early findings show those in western Canada and Quebec have had a significant shortage in hay and forage due to conditions being favourable for drought, and thus the early designation for the tax deferral.
“Canadian producers have had to face numerous challenges due to extreme weather conditions,” says Minister of Agriculture and Agri-Food, Marie-Claude Bibeau. “It is a priority for our government to quickly determine how the livestock tax deferral will be authorized to ensure that our producers have the support necessary to make informed herd management decisions and to help them keep their businesses strong.”
As the days move from summer to fall, the government says analysis and consultations will continue to make sure all regions affected will be included, and additional areas will be added if need be.
(Government of Canada)
According to a news release, the livestock tax deferral provision allows livestock producers in prescribed drought, flood or excess moisture regions to defer a portion of their 2019 sale proceeds of breeding livestock until 2020 to help replenish the herd. The cost of replacing the animals in 2020 will offset the deferred income, thereby reducing the tax burden associated with the original sale.
Currently, the criteria for identifying regions for livestock tax deferral is forage shortfalls of 50 percent or more caused by drought or excess moisture. These are identified by weather, climate, and production data, in consultation with industry and provinces.