MONTAGUE, P.E.I. - P.E.I. manufacturers and food processors in the agriculture sector will be able to access new tax and investment incentives as a result of federal funding recently announced and highlighted on Friday.
“Farmers will be able to write off larger portions of the depreciation in the year that the investment is made. For example, if a potato farmer invests $1 million on a tractor, the first year he can write off $450,000,” said Lawrence MacAulay, minister of agriculture and agri-food at Copper Bottom Brewing. The tax break MacAulay was referring to is an increase from 15 per cent to 45 per cent on the cost of equipment.
“It will free up capital, so you can grow your business and create more well-paying jobs.”
MacAulay highlighted some initiatives in the Fall Economic Statement for 2018 released last week, including those related to taxes and investments as well as trade.
“It puts more money in the pockets of farmers (and) quicker, and also down the chain and the line, the manufacturers, everything. It does a lot for the economy all the way and keeps the farmer on the cutting edge with top-notch equipment.”
Businesses like Copper Bottom Brewing would also be eligible for the tax and investment incentives. Ashley Condon, Copper Bottom’s co-owner (with her husband, Ken Spears), said as a business that’s just over a year old, the changes will impact the business significantly.
“If there’s anything that we’ve learned in this process, it’s that the first couple of years are going to be challenging, and the first year has been challenging from a cash flow perspective,” she said.
“We are planning on growing organically with the market demand. And, with thinking ahead to that, I’m really looking forward to those extra benefits, especially during the slower times of the year, to have that extra 30 per cent coming in of a return to help us get through those slower months.”
“We are planning on growing organically with the market demand. And, with thinking ahead to that, I’m really looking forward to those extra benefits, especially during the slower times of the year, to have that extra 30 per cent coming in of a return to help us get through those slower months.”
-Ashley Condon
As well, the federal government is investing $25 million over the next five years to expand and support Canadian agriculture and food exporters, including $12 million to access new markets.
“(It) will be invested in countries around the world with trade people and embassies and also making sure that countries around the world, where the rules are made for trade between nations, that they’re more fair,” he said.
“The big issue that I push is to make sure it’s science based. What we’re trying to make sure is that all countries adhere to a science-based regulatory system, which means that the scientists decide, the food people decide, that the food is perfectly safe. That does not mean that you go to a legislature and vote on what the scientists decide. It means that the scientists have the last say.”
An additional $13.6 million over three years to improve transportation data and inform improvements, and $11 million over five years is being allocated to the Canadian Food Inspection Agency to support market access.
“When you have the maple leaf symbol and the Canadian Food Inspection Agency approval, the world really knows that food is safe to eat,” said MacAulay. “And, when we’re trying to export worldwide, which brings new money into our country, that’s so vitally important.”
MacAulay also pointed out that the government is increasing its investment by $800 million over five years into the Strategic innovation Fund. The $800 million is in addition to the $1.2 billion previously announced.
