Agriculture and Agri-Food Canada

Agriculture and Agri-Food Canada

October 20, 2010 11:50 ET

Government of Canada Supports Alberta Livestock Producers Affected by Drought

OTTAWA, ONTARIO--(Marketwire - Oct. 20, 2010) - The Government of Canada is helping livestock producers struggling as a result of drought conditions by offering tax deferrals to an expanded list of municipalities.

"Our Government is putting farmers first by helping producers in Alberta who are suffering due to the dry, cool season they've had this year," said Agriculture Minister Gerry Ritz. "These tax deferrals will help farmers by increasing the money available to replenish their breeding stock for the following year."

The tax 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. Proceeds from deferred sales are included as income in the next tax year, when they may be at least partially offset by the cost of reacquiring breeding animals. In the case of consecutive years of designation, producers may defer sales income to the first year in which the area is no longer designated.

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. In cases where the herd has been reduced by more than 30 per cent, 90 per cent of income from net sales can be deferred.

Eligible producers will be able to request this deferral when filing their 2010 income tax returns. Livestock producers are advised to contact their local Canada Revenue Agency Tax Services Office for details on the income tax provisions.

Preliminary designation has been established based on spring moisture and summer rainfall, supplemented with estimates of forage yield. Final decisions and any needed adjustments will be made when all forage yield information is available, usually in December. Early designation of eligible areas will help producers make informed decisions about their fall and winter livestock management decisions.

Northern Alberta experienced very dry conditions, well below normal temperature and low precipitation, resulting in very poor soil moisture conditions and pasture and forage development.

Assessment of the drought situation will continue throughout the fall and, as more data about forage yields are known, tax deferral areas could be expanded.

For more information on the extent of the drought or programs to assist farmers, see the AAFC Drought Watch site at www.agr.gc.ca/drought .

Preliminary Designated Alberta Tax Deferral Areas

  • Birch Hills County
  • Clear Hills County
  • County of Northern Lights
  • Grande Prairie County No. 1
  • Improvement District No. 12
  • M.D. of Big Lakes
  • M.D. of Fairview No. 136
  • M.D. of Greenview No. 16
  • M.D. of Peace No. 135
  • M.D. of Smoky River No. 130
  • M.D. of Spirit River No. 133
  • Northern Sunrise County
  • Saddle Hills County
  • Woodlands County
  • Yellowhead County

Contact Information

  • Agriculture and Agri-Food Canada
    Ottawa, Ontario
    Media Relations
    613-773-7972
    1-866-345-7972
    or
    The Office of the Honourable Gerry Ritz
    Meagan Murdoch
    Press Secretary
    613-773-1059