The federal government recently downplayed the cost of carbon tax for producers
The Agricultural Producers Association of Saskatchewan (APAS) staff are speaking up against the federal government’s latest move in the carbon tax discussion.
Recently, Marie-Claude Bibeau, the federal minister of agriculture and agri-food, told reporters the carbon tax on grain-drying bills tax is not significant enough to necessitate a tax exemption for farmers.
However, some Saskatchewan producers were hit hard last fall with a wet harvest, which meant they needed to dry their grain.
“We have members who dried every single bushel of their grain last year. Every single bushel that came off the field had to go through a grain dryer,” said Todd Lewis, president of APAS.
So, the carbon tax compounded already high natural gas bills. This spring, crops that remained unharvest had to go through the grain dryer too, said Lewis.
The carbon tax “is not an insignificant cost, especially when you put it against the net farm income numbers,” Lewis told Farms.com.
If a producer has a $10,000 carbon tax bill and $1 million in expenses, the carbon tax only is 1 per cent of expenses, said Lewis.
While “it could be argued that (figure is) insignificant, we're a low-margin industry, especially on the grain side. So, the net farm income from that $1 million of expenses might be $100,000. If you compare that $10,000 against the $100,000 net farm income, you get 10 per cent,” he said. The carbon tax comes directly off the farmer’s net income and it can’t be passed on.
And Agriculture and Agri-Food Canada’s calculation of a producer’s average cost for the carbon tax doesn’t accurately reflect individual circumstances, said Lewis.
“It'd be like averaging grain drying across the entire population of Canada. There are people who don't dry grain. So, averaging (the cost) doesn't make any sense,” he said.
APAS staff will continue their lobbying efforts and their research into the actual cost of carbon tax for producers.
“We need to see some relief for a primary industry like agriculture and be treated like other primary industries in this country. It’s recognized that other parts of our economy have no way of passing the carbon tax along and they don't pay that tax,” he said. The carbon tax is “having a huge impact on our producers.”
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