March 31, 2017
The 2017 provincial budget presented last week contained a number of measures that will affect our province. Tough decisions were made to manage deficits and put the brakes on future debt. Agriculture was recognized as a major driver contributing revenue when other sectors have struggled. Even with the reduction in income tax, farmers, ranchers and rural people will see substantial tax increases and service reductions.
As of last week it is more expensive to fuel, insure, replace and provide parts for this engine. Increased taxes on fuel, insurance and vehicle purchases and education taxes, will cost roughly $72 million, or $2 an acre. We cannot pass added costs along, so that comes directly out of our pocket. The industry faces considerably lower commodity prices this year.
The budget’s shift to a consumption tax disproportionately affects agriculture. Farms and ranches are high risk ventures and rely heavily on insurance. It is not out of the ordinary for a farm to have a $100,000 in premiums; including crop, hail, building, vehicles, machinery, income and livestock coverage. The 6% PST on insurance is significant.
Agriculture is the engine that drives the Saskatchewan economy. Let's recognize that costs have increased to live and do business in the "country". If Saskatchewan is going to see better times ahead let's make sure that a major economic driver is allowed to flourish. Money may not grow on trees but it does grow in the fields and ranches of this province.
President, Agricultural Producers of Saskatchewan