[getsmart-l] Property Taxes Shouldn't Discourage Value-Added Activities

[John O'Gorman]

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To: CFFO Commentary List 
Sent: Friday, December 07, 2007 11:33 AM
Subject: CFFO Commentary - Dec 7, 2007


Note: Please direct correspondence on the CFFO Commentary to John Clement, General Manager at clement at christianfarmers.org.

                                                                                               

 

The CFFO Commentary

Title: Property Taxes Shouldn't Discourage Value-Added Activities

By Jenny Denhartog

December 7, 2007

 

The CFFO has spent considerable time recently on the issue of property taxation of farm properties. It's not a new issue, but one that came to the foreground a few years ago, when maple syrup producers and horse farmers found themselves receiving heft property tax increases due to the value-added component to their businesses. Over time, we were able to negotiate satisfactory solutions for those producers, but the issue isn't going away any time soon.

Recently the CFFO has become very concerned about incidents of increased taxation levels on buildings used for on-farm value added production. Farmers find themselves in the midst of a counterproductive cycle. On the one hand, government agencies encourage farmers to add value to their product. At the same time other government agencies, notably the Ontario Ministry of Finance, marginalizes the financial benefits of value adding by adjusting taxation levels on buildings used for this purpose. This is obviously not a sustainable situation. 

Municipalities are increasingly struggling to meet their budgetary needs. Property taxes are their main source of income, and it therefore stands to reason that higher property taxes would benefit them greatly. But making all on-farm value adding activities an industrial or commercial component, regardless of its tie to agriculture, will weaken our sector and be to the detriment of the rural economy. And that, in turn, leads to less economic activity and . less taxes.

As CFFO members continue to discuss the complexities of property taxation, they agree on a number of basic principles. As responsible citizens of Canada, they recognize that it is our responsibility to pay our fair share of taxes, which enables us to receive the rights, privileges and standard of living we enjoy. Surprisingly, they also agree that the very wealthy should not carry a disproportional part of the tax burden. Any suggestion that the residential property tax for an estate lot in the country could be much higher than usual was quickly struck down by our members, recognizing that wealth is often the result of hard work and should not be penalized by unreasonable taxation. Fairness is more important than a quick fix.

On behalf of Ontario's farmers, the CFFO will continue to work on fair taxation for on-farm value-added activities, trying to balance the needs of farmers and the needs of municipalities. This complex issue is far from over. As in the past we'll insist that long-term fairness, rather than a quick fix, is needed to allow the members of our farming community to confidently plan and build for the future.

 

 

Jenny Denhartog is the Field Services Associate of the Christian Farmers Federation of Ontario. The CFFO Commentary is heard weekly on CFCO Chatham, CKNX Wingham and CHOK Sarnia, Ontario and is archived on the CFFO website: www.christianfarmers.org/index.html. CFFO is supported by 4,353 family farmers across Ontario. 

 

 

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