Why farmers are relieved as heck by what Morneau and Trudeau have done

Like taking a furiously boiling pot off a red hot burner, Finance Minister Bill Morneau and Prime Minister Justin Trudeau have rapidly cooled the outrage and upset created by the federal government’s rushed small business tax proposals.

It has been a stunning turnaround from the previous combative and resolute tone the minister and PM were taking as they took on the alleged “rich” who were “making a lot of noise.” They didn’t just change their rhetoric, but said they were abandoning some of the proposed changes that were particularly upsetting farmers. That’s substantial change, and no doubt due to the loudness and ubiquity of the complaints. Morneau specifically acknowledged that he had heard from farmers and was responding to those concerns.

I don’t think farmers are feeling triumphant about this. Most that I have heard from say they feel relieved rather than elated. After all, what they have in front of them now is less disruption than what they were facing before, rather than something positively good. The government has dropped (at least for now) its proposal to limit or prevent the Lifetime Capital Gains Exemption from being used in some circumstances when passing land from a parent to a child. It is still going forward with its plans to eliminate “income sprinkling” to non-contributing members of the family, and the limit the use of cash within a company. So there are still some challenges ahead for some farms.

A few farmers I have chatted with have seemed annoyed and frustrated by the government’s reversal. These are those who hated the government’s proposed changes, but dislike the Liberal party and appeared to be enjoying the grief the government was getting from its ham-handed launch and defence of the proposals. That’s a political concern and not core to the issue at hand. I think most farmers are greatly relieved that this issue has quickly become less threatening.

There will be lots of wrangling over the proposals as the government moves forwards, and the devil is always in the details, but for now, relief has replaced outrage and panic amongst farmers.

 

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