The federal government unveiled a 2013 budget March 21 that threw agriculture a few small potatoes but largely ignored big ticket announcements.
Instead, it cited the Growing Forward deal that kicks in April 1 and last year’s elimination of the Canadian Wheat Board single desk in its “supporting farmers” section.
There were a few minor announcements.
Finance minister Jim Flaherty’s eighth budget said that effective next year, the lifetime capital gains exemption on farm sales would increase to $800,000 from the current $750,000 and the amount will be indexed to inflation.
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In 2007 in his second budget, he increased it to $750,000 from $500,000.
The government says this should be a $5 million tax benefit for farmers selling their operations in the 2013-14 fiscal year and $15 million the following year.
The budget also announced a doubling to $17,500 of the maximum amount of farm losses a part-time producer can write off against off-farm income.
The level had not been increased since 1988.
Farm loss write-off rules will allow full claim on the first $2,500 of loss and one half of the next $30,000.
The budget predicts the change will reduce federal tax revenues by $10 million over the next two years.
Flaherty announced a 10-year $70 billion plan to invest in federal and municipal infrastructure, including $32.2 billion to municipalities. It will include indexing the gas tax fund payments to inflation, drawing praise from the Federation of Canadian Municipalities.
“The new Community Improvement Fund will afford municipalities greater flexibility to allocate federal support toward a broader range of infrastructure priorities,” said the budget tabled in the House of Commons.
However, a Finance Canada official said during a background briefing that there is no specific commitment to funds for rural municipalities. The rural caucus of the FCM argues that rural municipalities have special infrastructure needs and the per capita funding formula usually provides little money compared to the infrastructure maintenance and replacement needs.
In a post-budget interview, Ritz insisted the budget includes a lot for rural Canada including infrastructure money and money for apprenticeship programs that could train needed workers. He said he expects some infrastructure money to be directed to smaller rural municipalities beyond their per capita allocation.
“Rural Canada depends on infrastructure, depends on jobs, depends on the economy bubbling along to allow people to buy their products,” he said. “That’s what this budget does.”
The budget also announced a five-year phaseout of a long-standing credit union income tax benefit it says is not available to other small businesses.
Last year’s budget ended a co-operative development fund and later in the year, announced that responsibility for co-ops was moving to Industry Canada from Agriculture Canada.
The Canadian Co-operative Association applauded the move, arguing the sector had become marginalized in Agriculture Canada.
