We will all feel the pain in this coming year of transformational change.
Maybe that’s not much comfort.
But it is better than what rural Saskatchewan residents might be hearing over the next year — that it’s high time the Saskatchewan Party government stopped showing favouritism to its rural Saskatchewan base.
A couple of points of clarity are likely needed here.
First, the only tax exemption in recent years have been on feminine hygiene products, so it just isn’t so.
Yes, Premier Brad Wall and company ran in 2007 on specifically reducing the education tax on agricultural land.
And it would be fair to say that this Sask. Party government has accommodated rural needs for new schools, hospitals and nursing homes in a way that the previous NDP government didn’t.
But to be fair to both the Sask. Party and the NDP governments, most rural amenities have been well established over the decades.
The real question is whether they remain viable or even fair in a world of increasing public debt, structural deficits and this new initiative outlined in the 2016-17 budget that Wall describes as transformational change.
For example, Provincial Auditor Judy Ferguson noted in volume one of her 2016 report that the province’s long-standing tax rebate for farm fuel — established in 1987 — seems to have little identifiable purpose anymore.
“It has not specifically been determined what the fuel exemption program is designed to achieve (other than reducing taxes for eligible individuals or corporations),” Ferguson’s report stated.
The law governing the act describes eligibility as a “farmer is a person who owns or rents land, controls and is responsible for the operation of a farm” and meets at least one of the following criteria:
• The person must own or rent at least 75 acres (30 hectares) of cultivated land in Saskatchewan, that is used for the growing of cereal crops; or
• The person received gross annual revenue of at least $10,000 from the sale of primary farm products that he or she produced in Saskatchewan.
A person may also qualify as a farmer if he or she is a member or shareholder in a farm organization, such as an agricultural corporation, farm partnership, a farm co-operative, or a farm colony, and contributed substantially to the agricultural production of that farm organization.
So one doesn’t even have to live or pay income taxes in Saskatchewan to qualify for this rebate.
One really doesn’t even have to make his or her living farmer as $10,000 in income or 30 hectares hardly merits consideration as a viable farming operation.
Heck, you only have to live on the farm. You pretty much qualify if you are a farm bookkeeper.
However, if you are a small part-time landscaping company in a city that makes $25,000 a year (doing lawn work or snow clearing) you don’t qualify for a rebate.
Farmers also enjoy provincial sales tax exemption on the farm machinery or pesticides and fertilizers — expenses that would largely be seen as doing business.
Again, in fairness, Ferguson’s report identified $3.9 billion — much of which goes to urban people.
Included in the list of tax exempt items in the 2016-17 budget: Construction, ($486.6 million); fertilizer, pesticide and seed, $163.4 million; basic groceries, ($129.3 million); farm activity, ($120.1 million); direct agents, ($98 million); low-income tax credits, ($90 million); basic groceries, restaurant meals and snack food, ($84.2 million); farm machinery and parts, ($83.8 million); electricity, ($49.4 million); used goods, ($36.5 million); prescription drugs, ($36.2 million); energy efficient appliances including furnaces and boilers, ($33.9 million); fuel for home heating ($28.7 million); reading materials, ($24.8 million), and; children’s clothing ($13.4 million).
So there are a lot of things that government could be looking at in its transformational process.
Sadly, that’s cold comfort for anyone.
Murray Mandryk has been covering provincial politics for over 22 years.
