Sask. producers support Bill C-208, which could make it more affordable to sell farms to a family member
REGINA -- Saskatchewan farmers are showing their support for Bill C-208, which recently passed its third reading in Canada’s House of Commons. The bill, which was introduced by Manitoba Conservative MP Larry Maguire, will make it more affordable for producers to sell their farms to a family member, instead of selling it to a non-family member.
“I’m trying to level the playing field for families and small businesses,” said Maguire. “The tax system today is very detrimental to them selling it to their own families, as opposed to a complete stranger.”
Maguire said currently, when a producer sells their operation to a family member, the difference between the sale price and the original purchase price is considered a dividend. If the producer sold to a non-family member, the sale is considered a capital gain, which is taxed at a lower rate than a dividend.
Yorkton-area farmer, Bill Prybylski, operates Creek Ridge Farms Ltd. with his brother, son and two nephews. He said this bill will make a difference in planning his succession plan.
“Most farmers are selling their farm or their shares in their farms to fund their retirement. So, having a significant tax burden would take a big chunk out of a farmer’s retirement plan,” said Prybylski.
Others in Saskatchewan are also hopeful the bill will move forward.
“It will make that farm or ranch more viable to pass to the next generation. And we need that, to keep those businesses productive and to not fragment them into less competitive sizes,” said Ryder Lee, CEO of the Saskatchewan Cattlemen’s Association.
David Marit, Saskatchewan’s Agriculture Minister, said more than 90 per cent of farms in the province are family connected, so this bill could have a significant impact.
“Especially when, we’re seeing, not only a continued growth in family members retiring, but we’re also seeing the same thing of young family members coming in,” said Marit.
Bill C-208 will now need to be passed by the Senate before it can become law. Maguire hopes to see the bill move forward in the Senate before Parliament rises for the summer at the end of June.