QUESTION PERIOD — Ministry of Agriculture and Agri-Food
Transfer of Small Business
June 2, 2022
Thank you for being with us today, minister.
With respect to land occupancy, one of the important steps is to ensure the continuity of family farms. This is an important issue as our farmers are facing many economic pressures. The average age of farmers continues to rise, and less than two thirds of them have a designated successor.
For many years, our tax rules have penalized those who want to transfer their business to a family member. It is more profitable for them to sell the business to a stranger or to simply close down, which undermines land occupancy.
We have known about this problem for a long time. The Prime Minister had asked you to resolve this issue in your previous mandate letter.
Last June, the Senate and the House of Commons passed Bill C-208 to correct this inequity. However, nothing has happened since then. Bill C-208 still has not been implemented. Budget 2022 only proposes a consultation process, even though this issue has been studied for several years.
How do you explain that, 12 months after Bill C-208 was passed, this legislation still has not been applied or come into force?
Our family farms are at the heart of the agricultural sector and land occupancy. I could not agree with you more.
Bill C-208 has been passed and is in force. People can now transfer or sell their business to a stranger or a family member under similar conditions.
I assume that the honourable senator is referring to our announcement that we want to clarify the definition of intergenerational transfer and we therefore plan to introduce a second bill.
I want to reassure people that if they are in a situation where they are making a true intergenerational transfer and are transferring their farm to family members, there is nothing to worry about. However, officials at the finance department have found that there were some abuses in the past with older legislation. We need to clarify what an intergenerational transfer is, so that this business transfer is not used as a simple tax evasion tool.
