Ontario Agriculture

The network for agriculture in Ontario, Canada

Proposed HST Benefits for Ontario's Farmers: It is estimated that Ontario farmers will save about $30 million an..

http://www.omafra.gov.on.ca/english/busdev/facts/HSTbenefits.htm

Proposed Harmonized Sales Tax (HST)
Benefits for Ontario’s Farmers


The 2009 Ontario Budget included a comprehensive tax package that would, when enacted, provide tax cuts for individuals, families and businesses to strengthen the foundation for job creation and future economic growth.

Starting July 1, 2010, Ontario’s Retail Sales Tax (RST) would be converted to a value-added tax structure and combined with the federal Goods and Services Tax (GST) to create a single, federally administered Harmonized Sales Tax (HST).

It is estimated that Ontario farmers will save about $30 million annually under the HST on items that are currently not exempt from the RST.

Farmers would continue to pay no tax on the majority of inputs purchased such as feed, seed, fertilizer, farm equipment and machinery, which are currently point of sale tax-exempt.

Under the HST, Ontario’s farmers would no longer pay sales tax on many items such as trucks, light vans and parts, furniture, lawnmowers, computers, freezers and other equipment. This would put Ontario farmers on a more level playing field with farmers in others provinces that have harmonized sales taxes.

The HST would follow the same rules and structure as the GST. Farmers who are currently remitting their GST paperwork would continue to do so and continue to receive input tax credits on any applicable purchased farm inputs.

What the HST Would do for Ontario Farm Inputs
Most farm inputs would continue to be zero rated and would be purchased without paying any tax.
Examples: feed, fertilizers, grain bins and dryers, seed, farm equipment and machinery, livestock purchases, pesticides, quota and tractors greater than 60 hp.

Farm inputs that are currently taxed with the RST would be subject to the HST and also be eligible for an offsetting input tax credit.
Examples: pick-up trucks used on the farm, computers and office equipment used in the farm’s business.

Farm inputs that are exempt from the RST but not the GST would be subject to the single sales tax, and also be eligible for an input tax credit.
Examples: contract work, freight and trucking, veterinary fees and drugs, custom feeding, machinery lease and rental, hand tools, fuel, oil and grease.

What's New
The 2009 Ontario Budget announced temporarily restricted input tax credits (ITCs) for large businesses, but excluded the farm use of energy.

In addition to the temporary ITC exception for energy, farms with more than $10 million in annual taxable sales would also not be subject to the restrictions for:

Telecommunication services other than internet access or toll-free numbers;
Road vehicles weighing less than 3,000 kilograms (and parts and certain services) and fuel to power those vehicles; and
Food, beverages and entertainment.
HST Benefits for Ontario's Farmers

Farmers would experience a net decrease in the sales tax they pay under the new proposed HST.
There would be about $30 million in new benefits under the HST.
Ontario’s farmers would no longer pay sales tax on many items such as trucks, light vans and parts, furniture, lawnmowers, computers, freezers and other equipment.
On average, farmers would realize about $600 annually in new benefits.
No identification or Purchase Exemption. Certificates required at the time of purchase.
No extra paperwork; any input tax credits to be claimed would be part of the existing GST filing.
Many farms would be eligible for a small business transition credit of up to $1,000.
Zero rated farm inputs mean that producers would pay no tax on more than $5.6 billion worth of items.

Additional Tax Reduction Measures for all Ontarians
93 per cent of Ontario taxpayers would receive a personal income tax cut.
The corporate income tax (CIT) rate for manufacturing and processing – which includes income from farming – would be cut to 10 per cent from 12 per cent.
The small business CIT rate would be cut to 4.5 per cent from 5.5 per cent.
This comprehensive tax package includes both temporary and permanent tax relief measures totaling $10.6 billion over three years.
Frequently Asked Questions
Q. Will I have to fill out separate tax returns when I apply for GST/HST input tax credits for the 2010 tax year?

A. No, all input tax credits would be claimed on the existing GST return.

Q. What is the frequency for filing a tax return?

A. The filing frequency for the HST would follow the current GST rules as dictated by the Canada Revenue Agency.

Q. Will I need to present a farmer ID card when making purchases?

A. No, farmers will not be required to provide identifications to purchase goods and services on a zero rated basis.

Q. How do I apply for the small business transition credit?

A. The details on the small business transition credit are still being developed and will be shared as soon as more information becomes available.

Q. Will I pay more sales tax on my farm business inputs?

A. No. Over all, you would pay less tax. Ontario farmers would save an estimated $30 million annually on new farm inputs that would no longer be subject to RST.



For more information:
Toll Free: 1-877-424-1300
Local: (519) 826-4047
E-mail: ag.info.omafra@ontario.ca

Views: 41

Reply to This

Replies to This Discussion

but don't forget that farm families,their employees and agribusiness employees are also consumers and not all of them are exempt

Reply to Discussion

RSS

Agriculture Headlines from Farms.com Canada East News - click on title for full story

Bibeau announces second cohort of Canadian Agricultural Youth Council

On Thursday, Marie-Claude Bibeau, Minister of Agriculture and Agri-Food, unveiled the names of the members who will form the second cohort of the Canadian Agricultural Youth Council (CAYC). The inaugural meeting of this new group of 25 young people will be held later this summer. The members of this cohort will serve 18-month terms. Representatives from Manitoba include Chantele Gouliquer and Boma N-Chris. "I was impressed by the energy and enthusiasm of the first cohort of the Canadian Agricultural Youth Council and look forward to working with this new group. Young people's perspectives on issues such as sustainable agriculture, innovation, intergenerational transfers, mental health and work-life balance allow us to shape the sector's future in their image," said Bibeau.

Ceres Global Ag Market Outlook

The Ceres Global Seeds Insight Tour included a market outlook this week. Minneapolis-based analyst Ryan Longhenry, with Ceres Global Ag, gave his outlook on the following crops:

August WASDE shows little change on U.S. acreage

The USDA released its August World Agricultural Supply and Demand Estimates (WASDE) report Friday morning. Jon Driedger is vice-president with LeftField Commodity Research. "Very few changes on the acreage side. It looks like farmers largely got the crop in even though there was the late start. From an overall yield perspective, a little bit lower on the corn. A little bit lower than what the market was expecting. A little friendly on the corn but a little negative on the beans. They actually bumped the yield up and that came in above expectations and so from a production perspective, maybe a little bit bearish on the soybean side."

France feeling the impacts of Canada's 2021 drought through mustard shortage

The people of France are feeling the brunt of 2021's drought as mustard supplies seem to be running low in supermarkets across the nation. France is the top consumer of mustard in the world and has been a staple of french households since the middle ages. Varieties like Dijon and Reims are processed by international companies but have their seeds mostly grown in Canada, with Saskatchewan and Alberta contributing to the vast majority of that crop.

Agri-Environmental specialists look to help producers make beneficial changes to farmland

BMPs, or Beneficial Management Practices, are a variety of programs that the provincial government is encouraging to help producers. Those can include infrastructure, land management, and other processes that help producers get the most out of their land. To help with that, Agri-Environmental Specialists are available to advise farmers as to the best practices.

© 2022   Created by Darren Marsland.   Powered by

Badges  |  Report an Issue  |  Terms of Service