Agriculture and Agri-Food Canada

Agriculture and Agri-Food Canada

February 01, 2007 16:11 ET

Canada's New Government Extends Federal Tax Deferral to Help More Farmers in Northwestern Ontario

OTTAWA, ONTARIO--(CCNMatthews - Feb. 1, 2007) - The Honourable Chuck Strahl, Minister of Agriculture and Agri-Food and Minister for the Canadian Wheat Board, today announced that Canada's New Government will extend federal tax deferrals for additional livestock producers in Northwestern Ontario.

"In addition to helping producers in the Rainy River and Algoma areas, we are happy to announce that we will provide assistance to producers in Kenora, Manitoulin and Thunder Bay through our federal tax deferral program," said Minister Strahl. "This program will assist livestock owners who were affected by drought, and who were forced to sell all or part of their herd. Canada's New Government is committed to helping producers overcome the challenges of the past several years."

Eligibility for the one-year federal tax deferral has been extended to include the Districts of Kenora, Manitoulin and Thunder Bay. The Rainy River and Algoma areas were declared eligible for the one-year tax deferral when initial designations were announced in December.

"Similar to other regions in Canada, producers in Northern Ontario have suffered economic losses for several years due to damaging weather conditions," said the Honourable Tony Clement, Minister of Northern Ontario. "I am proud that we can step up to address these challenges and provide our farmers with some of the assistance they need."

Owners of breeding livestock in the designated districts who were forced to sell all or part of their herd this year due to drought conditions will be eligible for a one-year tax deferral on 2006 income from these sales.

To defer income, the breeding herd must have been reduced by at least 15 per cent. Thirty per cent of income from net sales can be deferred if the breeding herd has been reduced by at least 15 per cent, but less than 30 per cent. Where the herd has been reduced by 30 per cent or more, 90 per cent of income from net sales can be deferred.

The deferral allows eligible producers in designated areas to defer income tax on the sale of breeding livestock for one year to help replenish breeding stock in the following year. In the case of consecutive years of drought designation, producers may defer sales income to the first year in which the area is no longer designated.

Eligible producers will be able to request this deferral when filing their 2006 income tax returns. Livestock producers are advised to contact their local Canada Revenue Agency Tax Services Office for details on the income tax provisions.

Contact Information

  • Agriculture and Agri-Food Canada
    Ottawa, Ontario
    Media Relations
    Minister Strahl's office
    Jeff Howard
    Press Secretary
    Agriculture and Agri-Food Canada
    Regina, Saskatchewan
    Trevor Hadwen