FARMERS AND HOCKEY: MORE IN COMMON THAN BURGERS, BREAD AND BEER
Originally published on November 27, 2003
I took a tax class in Toronto a few weeks ago and while there, made a stop at the Hockey Hall of Fame.
The highlight for me was to see and touch the Stanley Cup. This trophy is housed at the Hockey Hall of Fame for only part of the year. For the remainder it is in the hands of the NHL team that won it.
While Canada celebrated two Olympic Gold medals in 2002, it has been too long since a Canadian NHL team last won the cup. Unfortunately some Canadian NHL team owners are now saying that without changes in the way they do business in this country, they will not be able to compete. They point to high municipal taxation, rising costs and a general feeling they are not appreciated for what they provide economically to their respective NHL cities and communities.
Isn't this the same news release that has been put forward by Canadian farmers?
First, Canadian NHL teams and farmers both want lower taxes. Canadian farmers pay a special levy for education. This tax is levied on farmland and production buildings. If education is a public benefit, then shouldn't it be shared equally by all members of the public? The average farm family will pay from four to eight times as much education tax as the non-farm family in the same school division.
Canadian farmers also pay considerable federal excise taxes on their fuel purchases. The federal excise tax on diesel and gasoline is approximately four cents per litre. In our farming operation we had estimated that the taxes on diesel alone were $48.59 per seeded quarter section.
The Canadian NHL team owners are also complaining that they have a much higher tax burden than their U.S. counterparts. We can march together.
Second, we are both experiencing rising costs. Canadian NHL team owners quickly point to escalating player salaries. The average NHL salary increased 213 percent from 1993 to 2003. In 1993, players secured an average salary of
about $600,000 US per season. A decade later the average player salary is $1.8 million per season.
Canadian farmers have also seen their operating costs jump. Saskatchewan farmers paid $248 million on fertilizer in 1991. In 2001, Saskatchewan farmers paid $575 million for fertilizer. This is an increase of 231 percent.
In 1991, Saskatchewan farmers spent $181 million on chemical purchases. In 2001, Saskatchewan farmers spent $567 million on chemical purchases, an increase of 313 percent.
Farmers at times feel underappreciated by our cities. Canadian NHL team owners espouse the many economic benefits generated by holding a professional hockey franchise.
Canadian farmers point to a cheap food policy and their diminishing share of the retail dollar.
Brian O'Neill from Oxfam Canada said that "the price a farmer receives for a bushel of wheat has not changed in 25 years, yet consumers pay three times as much for bread. Looking at it another way, in 1975, 13 percent of the retail cost of a loaf of bread went to the farmer. Today, only four percent does."
In Canada, government support accounts for nine percent of the value of farm production. Meanwhile, that figure is about 29 percent in the United States and 41 percent in the European Union.
Why couldn't Canadian farmers work with some Canadian NHL team owners to develop a glitzy television spot?
Farmers could showcase the importance of our fresh burgers, bread and beer while Canada's NHL team owners would showcase the importance of cheering for a Canadian hockey team.
So this hockey season, when we support our favourite Canadian team, let's not forget to support Canadian farmers.
Allyn Tastad, chartered professional accountant, is a partner in the accounting firm of Hounjet Tastad Harpham in Saskatoon at 306-653-5100, e-mail at email@example.com or website www.hth-accountants.ca. All data and information provided is for informational purposes only. Readers are cautioned that laws and regulations are subject to change. Consult your accountant for current professional advice tailored to your situation.