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Better Farming Ontario magazine is published 11 times per year. After each edition is published, we share featured articles online.


MPP proposes tax break for food donations

Monday, September 27, 2010

by SUSAN MANN

Ontario’s farmers may be able to start receiving a tax credit next year for unsold or surplus food donations they make to food banks.

So far, Sarnia-Lambton MPP Bob Bailey’s private members bill calling for farmers to get a non-refundable Ontario tax credit of 25 per cent of the wholesale value of food they redirect to food banks has sailed through first and second reading in Ontario’s Legislature with strong support. In fact, Bill 78 passed second reading Sept. 16 with unanimous support from all parties. The bill would also permit unused tax credits to be carried forward and deducted for up to five years.

Bailey says his proposal is a win for everyone. Farmers would benefit because they’d get the tax credit for food they can’t sell due of imperfections or it is surplus to the needs of their processor or market. That food would otherwise have to be thrown out or ploughed into the soil.

Food banks would benefit from the added food donations. Bailey says more than 25 million pounds of food annually is thrown out or ploughed under by farmers because imperfections prevent supermarket chains from buying it.

Ontario Federation of Agriculture president Bette Jean Crews says in addition farmers always have to plant more than they think they’re going to sell in case there’s a drought or a flood. That surplus product could also be donated.

She says the proposal will help farmers cover the costs of gathering the leftover food.

 There are farmers who currently donate produce to food banks but some can’t because it costs more than they can afford to pick and deliver their product. “This tax break is going to cover some of that,” she says, noting the Federation is very supportive of the proposal.

Bailey says in the first year, the program would cost the government about $750,000 “but they could get up to five million pounds of food in return.” That would go a long way to offsetting the food shortfall at food banks.

He says last year food banks fell short by more than one million pounds of food.

It wouldn’t just be farmers with unsold or surplus food who’d benefit from the tax credit. Dairy farmers participating in their organization’s milk donation program could take advantage of it too.

Bill Mitchell, Dairy Farmers of Ontario assistant communications director, says their understanding of the bill’s intent is that dairy farmers would be able to get the tax credit.

Dairy Farmers’ has run a milk donation program for more than 12 years. During the organization’s 2008-2009 fiscal year, 366 producers donated about 845,000 litres of milk. The milk is distributed to about 100 food banks. As part of the program, milk haulers transport the milk for free and processors don’t charge for processing it.

Mitchell says more farmers might be encouraged to join the program if they get the tax credit. “Farmers always support food banks and getting that value recognized only encourages it more.”
 
The proposed bill still has to go through committee and receive third reading before it’s passed. It’s slated to go to the general government committee later this fall, likely in November. Bailey is hoping his proposal will be in place in time for the next provincial budget, which comes out by the end of March.

Still, with only six per cent of private members’ bills getting passed, Bailey isn’t counting his chickens before they’re hatched. “I’m not sitting here saying that I guarantee its going to go through.”

There are 120 community food banks across Ontario serving 375,000 people a month and 40 per cent of those served are children. BF
 

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