The Liberals have refused a request by a Reform party MP that a House of Commons committee study ways farmers could lessen tax bills on the forced sale of livestock due to natural disaster.
It was one of the last items of business discussed in the Commons two weeks ago before MPs adjourned to spend 11 weeks back in their constituencies.
Athabasca, Alta., MP Dave Chatters had introduced a private member’s bill asking the government to extend existing rules that allow farmers to defer income tax on revenue raised when they have to sell livestock because of drought.
Read Also
European wheat production makes big recovery
EU crop prospects are vastly improved, which could mean fewer canola and durum imports from Canada.
Chatters told the Commons June 11 the existing law is unfair. He used as an example farmers in the Peace River area, who lost crops for two consecutive years because of too much moisture.
If they had been in a designated drought area and had to sell their cattle for lack of feed, they could have deferred income tax on the revenue.
“This bill simply aims to remove the inequity by extending that same consideration to all farmers forced to sell or destroy livestock due to natural disasters, infection or disease,” he said.
Chatters said government should realize farmers forced to liquidate herds because of extraordinary circumstances already face financial stress. During the Peace River floods, he called it a “vicious circle” of hardship, forced liquidation and more hardship.
“When the farmers were taxed on the pittance they received for the sale of their livestock, the additional financial burden of taxation was unbearable to many,” he said.
Opposition MPs agreed with the Reformer.
The Liberal government did not.
Proposal too general
Tony Valeri, parliamentary secretary to finance minister Paul Martin, said he supported the principle of the Reform proposal but it was flawed.
It does not make clear that help would only be available in widespread disaster and not just local problems. And it is too vague about when and how much deferral could be allowed, he said.
“The proposed amendment, despite its good intentions, is not consistent with current tax policy and does not effectively address the difficulties faced by affected farmers,” he said.
Chatters offered a compromise.
He would withdraw his motion if the issue was referred to the Commons agriculture committee to try to find a way around Valeri’s criticisms.
However, the idea required unanimous consent. Some Liberals shouted “no” and the issue was dropped.
