Federation suggests three-tiered aid approach for farmers

Farmers need some short-term relief, and the Prince Edward Island Federation of Agriculture has a short list of ways government can help.

Earlier this week, the province announced an immediate 25 per cent depreciation on the assessment of farm buildings used for hogs, beef, and potatoes.

This was done as a short-term relief effort for farmers, said Provincial Treasurer Wes Sheridan.

The hog beef and potato sectors have been struggling, and we want to make sure that their tax burden was fair.

Mike Nabuurs of the PEI Federation of Agriculture said this tax relief is a good start, but more needs to be done.

Here at the federation, weve been lobbying and pushing quite hard to see some short-term relief. And this will help some. But in terms of short-term relief, we feel a three-tiered approach is necessary.

The first and most important thing the sector needs is an elimination of taxes for farm trucks, Nabuurs said.

They are able to use tax-free fuel in their tractors and transportation used to be a lot more done with tractors and wagons, but now its all done with trucks, he said.

Being able to use that tax-free fuel in their trucks would help to offset the skyrocketing fuel prices.

Another help for the farming sector would be some provincial help with the Advance Payment Program.

Currently, this federal program offers loans to farmers up to $400,000. The first $100,000 is interest-free for the producer, as it is paid by the federal government.

The federation wants the province to help by paying the interest on the remaining $300,000.

The third request from the industry is more tax relief.

We did get a portion of that by them addressing this (building assessment) issue, but we were seeking elimination of all land and building tax on farms.

This would bring PEI more in line with neighbouring provinces, Nabuurs said.

Because of the HST, farmers in New Brunswick and Nova Scotia are able to get all of their farm inputs back. We do not have HST here so farmers only get their GST back on their farm input costs.

There are some PST exemptions, but there are a number of things not covered, Nabuurs continued.

An elimination of all land and building tax on farms would help to bring us to tax parity with Nova Scotia and New Brunswick.

Sheridan said the federations requests are being reviewed by the treasury and the Agriculture Department.

In the meantime, Sheridan was pleased to be able to offer the 25 per cent reduction in the depreciation of farm buildings no longer being used for potatoes, hogs and beef.

(This article was originally published in The Guardian.)