Saskatchewan’s ministry of finance has announced several changes to its provincial sales tax (PST) regulations that are aimed at bringing better clarity, fairness, and consistency to the farming sector and its expenditure on goods. According to the Saskatchewan Cattlemen’s Association chair, Arnold Balicki, the changes, which are expected to cost about $1 million annually, will hopefully benefit farmers who have had to struggle under rising inflation and operating costs in recent years. He affirmed that cattle producers were appreciative of the recognition given to how PST impacted farm-related activities.
Deputy Premier, MLA, and Minister of Finance, Donna Harpauer, said that following discussions with agricultural organisations in the region, they found reports of inconsistency in how PST was applied to farming activities and that the new changes would ensure regulations were equitably and consistently applied, protecting farmers from ‘PST creep’. The ministry has also confirmed that they have started discussions on how future budgets may include accommodations for modernising agriculture and farming section of PST legislation, starting in the 2023-24 budget development cycle.
Effective from April 1, 2022, the new PST exemptions were created from the changes. These new exemptions will now include corral slabs and wind-breaker panels used in protecting and handling livestock animals, insulators used in electric livestock fencing, specific farming equipment to be attached to registered vehicles, and trenching and on-farm dugout excavation that is farm-related.
The ministry further clarified that certain products would be exempt from PST, with the exemptions being retroactively applied to purchases made from April 1, 2016. The affected products include water storage tanks to be used for irrigating or spraying produce, storage tanks for liquid fertiliser, fungicides, insecticides, herbicides, and weed control chemicals, adjuvants used for application or efficacy, certain portable seed cleaners, and farming tractors.
These changes come just two months after the Saskatchewan government announced budget plans to expand the application of PST to entertainment activities like concerts, rodeos, Riders games, gym memberships, and more. This change is predicted to boost tax revenues by about $21 million annually. The broader application of PST is expected to take effect from October 1 and has drawn criticism that it will badly impact the mental and physical health of residents.
The venues and businesses involved in providing these services are also expected to suffer from the implementation of the tax, just when their fortunes were beginning to revive after the effects of the pandemic. Gym owner, Jolene de Vries, said that now was not the time to discourage people from healthy pursuits that could improve on challenges like high blood pressure and diabetes.
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