A private member's bill tabled yesterday - Bill C-274 - is taking on the inefficient tax treatment of intergenerational transfers for small businesses, addressing a major issue for family farm and fishing businesses. The Canadian Federation of Agriculture (CFA) is pleased to see MP Guy Caron's bill propose amendments to the Income Tax Act that would ease the tax burden on farmers seeking to transfer their businesses to the next generation.
"Over $50 billion in farm assets are set to change hands over the next 10 years as farmers age and future plans are made. In order to ensure the continuation of family farms in Canada, urgent efforts are needed to address the barriers hindering farm transfers to family members. We are pleased to see this issue move forward in Parliament and are hopeful it receives the political profile and priority it deserves," said CFA President Ron Bonnett.
CFA regularly hears from farmers across the country encountering significant and costly obstacles when attempting to pass their businesses on to family members. Specific tax rules pose disincentives to keeping farms within the family and actually incent sales to non-family members. In many instances, farmers find it markedly less costly to sell their farms to outside buyers.
"Simply put, if taxation barriers aren't addressed, we will see fewer and fewer family farms in Canada. We support Mr. Caron and his colleague's commitment to addressing these tax burdens that could cause significant administrative burden, cost, and ultimately disruption to what looks to be the most significant period of farm transfers in the history of Canadian agriculture," added Bonnett.
At this point, 98% of Canadian farms continue to be family-owned and operated and CFA is committed to working with government, and all parties, to ensure the Income Tax Act supports the continuation of this successful and valued farming tradition.
Source: CFA