Immediate senate action sought for farm tax relief

Apr 10, 2024

By Farms.com

A diverse coalition of farm groups is pressuring the Senate to approve the Tax Relief for American Families and Workers Act swiftly. This legislation, which has garnered bipartisan support in the House, is deemed essential for the agricultural community, particularly for its tax-related benefits that facilitate farm operations and investments.

Central to the coalition's advocacy are tax provisions like Section 179 expensing and the mitigation of the bonus depreciation phase-down. These elements are crucial for farmers, allowing for strategic investments in equipment that lead to more efficient, resilient, and sustainable farming practices.

The current trajectory of phasing down bonus depreciation and the challenges surrounding 1031 exchanges are causing financial strain, increasing tax burdens, and hindering the ability to reinvest in agricultural businesses.

The urgency conveyed by the agricultural coalition underscores the immediate need for legislative action, stressing that delays until 2025 would detrimentally impact the farming community. The call to action includes urging farmers and ranchers to engage with their Senators, advocating for the bill's passage or the negotiation of a compromise that addresses the pressing needs of the agricultural sector.

The agricultural community's push for this legislation highlights a collective effort to ensure the sustainability and growth of farming operations across the country. By facilitating tax relief and supporting investment in the sector, the coalition aims to secure a vibrant future for agriculture, ensuring it continues to play a critical role in feeding the nation and contributing to its economic well-being.

Video: Western Canadian Agriculture: Hard Times Made the World's Best Farmers

Western Canadian agriculture produced the most advanced farmers in the world not through abundance but through adversity. The crow rate fell. The wheat price went nowhere. The brown envelopes stopped.

When the subsidies disappeared, the bad farmers left and the good ones stayed. And the ones who stayed could not just grow wheat anymore. They started growing lentils and canola and peas and flax and faba beans. They built crop rotation. They got serious about agronomy because there was no government backstop. That process produced the Western Canadian agriculture Dennis Bulani describes in this clip: the most advanced, most educated farming culture in the world.

His contrast with Iowa corn and soybean farmers is sharp. At a DeKalb farmer meeting in Okoboji, Iowa, he asked what crop rotation they ran. Beans on corn stubble, corn on bean stubble. How do you fertilize? The co-op agronomist handles it. Have you considered other crops? No need. We make so much money on corn and soybeans. Western Canadian agriculture was never allowed that comfort. And now those Iowa farmers are watching soybean markets lock up with China and corn prices slide, and they do not have the agronomy knowledge or the research base to pivot. Western Canadian farmers adapted on a dime because they had done it before.

Dennis also makes the case that Western Canadian agriculture keeps adapting in real time. Low commodity prices over the past year have pushed growers to look seriously at precision spot-spray technology. He knows a neighbor who bought a sprayer with the seeing-eye system and sprayed only 80 out of 320 acres. As a chemical retailer Dennis acknowledges that will affect his sales. He supports it anyway, because if it advances Canadian agriculture and makes farmers money, that is a good outcome.

The lesson Dennis draws from the tale of two farms: continuous improvement is the only durable strategy. When canola was $22 a bushel some growers went to Arizona instead of the Crop Production Show. When the price came down those same growers came back to the research and the discipline. Products do not go on Rack Petroleum's shelves unless they pass a replicated trial first. That is what Western Canadian agriculture built through hard times: farmers who do the work whether the times demand it or not.

Dennis Bulani is CEO of Rack Petroleum and Ultimate Yield in Biggar, Saskatchewan. Dan Aberhart hosts GTF Productions, Western Canadian Agriculture's foremost live briefing platform and its foremost AI training platform for ag operators