Family farms breathe easier as Liberals ditch tax proposal

The executive director of theP.E.I.Federation of Agriculture is "cautiously optimistic" about Ottawa abandoning proposedtax changes thatwould have made it difficult for familiesto pass their farmson to their children.

RobertGodfreysays the Federation hasbeen part of a cross-Canada lobby against federal finance minister Bill Morneau'stax proposals thatwere revealedthis summer.

On Thursday, Morneau announced that he has listenedto the outcry fromfarmers and lobby groups like the Federation andis going to "takea step back" from the tax proposal that would have restricted the conversion of income into capital gains.

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Farmers were fearful of the proposedtax change,Godfreysaid, because it would have "penalized family farm transfers" in a way that the parents would be stuck with a considerable tax bill after transferring the farm to their child.

"It was sort ofincentivizingpeople to sell their farm to non-family members. That's not the style of family farming here on Prince EdwardIsland we wanted to ensure that that wasn't impeded in any way."

'Hopefully ... changes don't hurt family farms'

The Liberals' withdrawalfrom the tax proposal, Godfrey said, is not a total win,but "it's certainly a step in the right direction."

"We've been working on a weekly basis with them to make sure ourconcernswere heard by the right people in finance and thePMO,"Godfreysaid.

Though the Liberals are taking a step back for now, Godfrey said the "devilstill remains in the details" as the feds haven't tabled any sort of legislation yet.

"I have to see it on the floor of the House of Commons to see if we're getting what itis we've asked for," he added.

"Hopefully at the end of the day, the changes don't hurt family farms here on P.E.I."

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