Tuesday’s federal budget contains some welcome measures for farmers but no commitment to promote investment and growth in the ag sector, according to the Canadian Federation of Agriculture.
The CFA, in the midst of its annual general meeting this week in Ottawa, said late Tuesday that the budget, on top of its reaffirmation of aid for livestock producers through advance payment loans, “offered some measures that will help farmers invest in value-added processing and in renewable energy.”
Specifically, the farmers’ group noted the expansion of capital cost allowance (CCA) deductions for investment in equipment and machinery for manufacturing and processing industries, which it said “will be beneficial for farmers engaging in value-added production as part of their operations.”
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Those measures have also been expanded to cover machinery for renewable energy generation, such as biogas production from agricultural biodigesters, CFA noted.
In a separate release Wednesday, the Manitoba government, for one, said it would parallel the capital cost allowance measures for manufacturers “that
allow for the fast writeoff of new investments, providing further
tax relief” to the province’s manufacturing sector. The province also said it wouldn’t tax savings that individuals deposit in Ottawa’s newly-proposed tax-free savings accounts.
CFA also noted that GST (and harmonized sales tax, or HST) relief for lands leased for natural resource exploration is to be expanded to cover lands leased for wind and solar power projects. “These two measures will help agriculture play a greater role in the development of renewable energy,” the association said.
Research and development funding for biofuels and a pilot project to promote E85 ethanol were also welcome, CFA said, though it “would have liked to see additional measures to empower farmer participation in the biofuels industry and ensure benefits accrue back to the farm gate.”
The association “is also concerned the budget did not contain any initiatives or commitment to promote investment and growth in the agriculture industry” such as the CFA’s own recent proposal for a co-operative investment plan, which would offer tax incentives for investment in ag co-operatives.
CFA also saw no reference in the budget to the new federal/provincial “Growing Forward” agricultural policy framework now in development.
“We hope there will be some flexibility beyond the budget to pursue some of these ideas,” said CFA president Bob Friesen, a farmer from Wawanesa, Man.
