Carbon tax costs each Ontario farm, agri-business $16,000: Survey

By Connor Lynch
How much the federal carbon tax is costing farmers depends on who you talk to but it seems everyone agrees it’s too much.

A Canadian Federation of Independent Business survey, released last month, found that producers and agri-businesses paid, on average, $16,000 in 2019 in direct and indirect carbon taxes, based on their own estimates.

Researchers spoke to 237 agri-businesses and farmers (two-thirds were primary producers and one-third were agri-businesses) that are CFIB members in Ontario, Saskatchewan and Manitoba. That included 169 in Ontario, of whom about 72 said they pay the carbon tax directly. Their carbon tax estimate included taxes paid from all direct and indirect costs added onto transportation, propane and natural gas, fertilizer, pesticides and shipping costs.

The survey found that 76 per cent of Ontario farmers said they had taken action in the last few years to lessen their environmental impact and 92 per cent said the government shouldn’t be charging taxes on top of the carbon tax.

The Grain Farmers of Ontario (GFO) estimates the carbon tax accumulation on input costs is about $14 per acre. The GFO also estimated the cost of the carbon tax just to dry grain through the slow, wet harvest last year. That estimate? About $12 million, or just more than $400 per farm across Ontario’s 28,000 grain farms.

“It’s stunning. It’s stunning. That’s a huge number,” said GFO chair Markus Haerle. Haerle said it may not look like much for individual producers, but that’s $12 million of profit out of farmers’ hands and into federal coffers. “The general consumer is benefitting off taxation the farmer is being forced to pay. It’s downright frustrating to see something like that.

“(But) that’s not the scary part,” said Haerle. The worst is yet to come as the carbon tax increases, with the GFO estimating that carbon tax will cost farmers $30 million by 2021 to dry their corn.

Almost everyone has been affected, said CFIB. Ninety-four per cent of crop farmers and 93 per cent of livestock farmers in Ontario said that the carbon tax has negatively affected their business.

The Agricultural Producers Association of Saskatchewan has also weighed in and estimated that a 5,000-acre grain farm paid of between $8,000 and $10,000 in carbon taxes in 2019, counting direct and indirect costs.
Federal ag minister Marie Claude-Bibeau, in speaking to farmers about the impact of the carbon tax, has repeatedly said she needs more data. Vice-President for Western Canada and Agri-business Marilyn Braun-Pollon said: “The data is clear. We would hope that the minister would act.”