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TAX DEFERRAL TO BENEFIT FARMERS IN SOUTHERN BRITISH COLUMBIA
OTTAWA, Ontario, March 7, 2008 - Owners of breeding livestock in certain areas of southern British Columbia who were forced to sell all or part of their herd in 2007 due to drought conditions will be eligible for a one-year tax deferral on 2007 income from these sales.
"This government understands the ongoing impact drought has on farmers, which is why British Columbia farmers struggling with drought will continue to receive support from the Government of Canada through our tax deferral program," said The Honourable Gerry Ritz, Minister of Agriculture and Agri-Food and Minister for the Canadian Wheat Board. "Tax provisions offered by this program will allow farmers to restock their herds in the spring."
The deferral was made after reviewing forage yield, precipitation, soil moisture and water supply data for the 2007 growing season. In the case of consecutive years of drought designation, producers may defer sales income to the first year in which the area is no longer designated.
"Here in the Okanagan Valley I have seen first-hand the effects drought has on agriculture," said the Honourable Stockwell Day, Minister of Public Safety and Member of Parliament for Okanagan - Coquihalla. "The Government's tax deferral program helps support our hard working farming families affected by drought conditions in Canada."
Thirty per cent of income from net sales can be deferred if the breeding herd has been reduced by at least 15 per cent, but less than 30 per cent. Where the herd has been reduced by 30 per cent or more, 90 per cent of income from net sales can be deferred. This will help replenish breeding stock in the coming year.
Eligible producers will be able to request this deferral when filing their 2007 income tax returns. Livestock producers are advised to contact their local Canada Revenue Agency Tax Services Office for details on the income tax provisions.
Please see attached list of designated areas for 2007.
For more information, media may contact:
Agriculture and Agri-Food Canada
The Office of the Honourable Gerry Ritz
Regional District of Central Kootenay
Regional District of East Kootenay
Regional District of Kootenay Boundary
Regional District of Okanagan-Similkameen
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