Ottawa, Ont. (Rural Roots Canada) – Livestock producers forced to sell part of their breeding herds because of drought, flooding, or excess moisture may be able to delay paying some of the resulting income tax.
Agriculture Minister Heath MacDonald announced Tuesday the initial list of regions eligible for the 2026 Livestock Tax Deferral provision.
The program allows producers in prescribed areas who face forage shortages to defer a portion of their income from breeding-herd sales until the following tax year. That income can then be at least partly offset by the cost of buying replacement breeding animals.
To qualify, producers must have reduced their breeding herd by at least 15 percent.
The federal government says neighbouring regions can also qualify if they are close to areas affected by drought, excess moisture or flooding and face similar conditions.
Eligibility is based on weather and climate data analyzed through the Canadian Drought Monitor.
See the complete official 2026 prescribed-region list at this link.
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“Canadian livestock producers work hard every day to be resilient in the face of unpredictable challenges due to extreme weather conditions,” said MacDonald, adding that this will provide them with greater flexibility and certainty when making decisions about their herds and operations.
The government says it will continue monitoring weather, climate and production data through the growing season and add regions when conditions result in significant forage-production declines.
For producers dealing with consecutive years of drought or excessive moisture and flooding, sales income can be deferred until the first year their region is no longer prescribed.
The federal government also urged producers to use other business-risk programs, including AgriStability, AgriInsurance and AgriInvest, to help protect their operations from severe weather-related losses.
