Remission Order in Respect of the 2016–2017 and 2019 Bovine Tuberculosis Outbreaks: SI/2026-27
Canada Gazette, Part II, Volume 160, Number 12
Registration
SI/2026-27 June 17, 2026
FINANCIAL ADMINISTRATION ACT
P.C. 2026-554 June 4, 2026
Her Excellency the Governor General in Council, considering that it is in the public interest to do so, on the recommendation of the Minister of Finance, makes the annexed Remission Order in Respect of the 2016–2017 and 2019 Bovine Tuberculosis Outbreaks under subsection 23(2)footnote a of the Financial Administration Actfootnote b.
Remission Order in Respect of the 2016–2017 and 2019 Bovine Tuberculosis Outbreaks
Definitions
1 (1) The following definitions apply in this Order.
- Act
- means the Income Tax Act. (Loi)
- compensation amount
- means the amount deducted by a taxpayer in computing the taxpayer’s income from a farming business under subsection 80.3(2) of the Act for the 2016, 2017 or 2019 taxation year, as the case may be, in respect of the forced destruction of livestock under section 51 of the Health of Animals Act due to bovine tuberculosis. (montant de compensation)
Application of meanings in Act
(2) Unless the context otherwise requires, words and expressions used in this Order have the same meaning as in the Act.
Remission of tax, interest and penalties
2 Remission of tax, interest and penalties is granted to taxpayers in the amount determined by the formula
- A − B
- where
- A
- is
- (a) in the case of a taxpayer that received a compensation amount and that carried on the farming business in Alberta or Saskatchewan in any year during the period from 2016 to 2017, the total amount payable under the Act, if any, for the taxpayer’s 2017 to 2020 taxation years, and
- (b) in the case of a taxpayer that received a compensation amount and that carried on the farming business in British Columbia in any year during the period from 2018 to 2019, the total amount payable under the Act, if any, for the taxpayer’s 2019 to 2022 taxation years; and
- B
- is
- (a) in the case of a taxpayer that carried on the farming business in Alberta or Saskatchewan in any year during the period from 2016 to 2017, the total amount that would be payable under the Act, if any, for the taxpayer’s 2017 to 2020 taxation years if the compensation amount were included in income as follows:
- (i) 83% for the 2018 taxation year,
- (ii) 11% for the 2019 taxation year, and
- (iii) 6% for the 2020 taxation year, and
- (b) in the case of a taxpayer that carried on the farming business in British Columbia in any year during the period from 2018 to 2019, the total amount that would be payable under the Act, if any, for the taxpayer’s 2019 to 2022 taxation years if the compensation amount were included in income as follows:
- (i) 83% for the 2020 taxation year,
- (ii) 11% for the 2021 taxation year, and
- (iii) 6% for the 2022 taxation year.
- (a) in the case of a taxpayer that carried on the farming business in Alberta or Saskatchewan in any year during the period from 2016 to 2017, the total amount that would be payable under the Act, if any, for the taxpayer’s 2017 to 2020 taxation years if the compensation amount were included in income as follows:
Coming into force
3 This Order comes into force on the day on which it is made.
EXPLANATORY NOTE
(This note is not part of the Order.)
Proposal
The Order in Council authorizes the Minister of Finance to provide tax relief to taxpayers whose livestock were affected by the bovine tuberculosis (TB) outbreaks from 2016 to 2019. It codifies the tax relief previously announced on November 6, 2017 (the Announcement), and that has already been applied for taxation years 2016 to 2019.
Objective
The objective of this Order is to allow taxpayers affected by the bovine TB outbreaks in 2016–2017 and 2019 to extend the period during which they can defer the inclusion in their income of the amount of compensation they received under the Health of Animals Act (HAA) as a result of the forced destruction of their livestock. To the extent that the affected taxpayers have already filed their tax returns for 2016 to 2019 on the basis of the Announcement, this Order is necessary to ensure that the Canada Revenue Agency has the ability to administer the tax rules accordingly.
Background
Between 2016 and 2019, bovine TB was detected in animals in Canada, leading to the declaration of an outbreak by the Government of Canada, and the commencement of investigations at facilities in Alberta, Saskatchewan and British Columbia. Orders were issued for the destruction of more than 12 000 animals and compensation was paid to impacted ranchers pursuant to the HAA.
Where an order is made under the HAA for animals to be destroyed, the Minister of Agriculture and Agri-Food Canada (AAFC) is permitted to order that compensation be paid to the owner of such animal. In this regard, the Compensation for Destroyed Animals and Things Regulations set out the maximum amount that may be paid per animal that is destroyed. The compensation is intended to offer support to impacted ranchers in purchasing replacement animals. Alberta and Saskatchewan ranchers received compensation in 2016 and 2017, and British Columbia ranchers received it in 2019. In total, these ranchers received approximately $40 million in compensation.
The current tax rules allow taxpayers to defer the inclusion in their income of amounts received as compensation for the forced destruction of livestock from the current tax year to the following tax year. The purpose of this mechanism is to align the timing of the receipt of compensation for replacement animals with that of the purchase of those animals, as those expenses are likely to be incurred in the year that follows the year in which compensation is received.
However, because of the extraordinary circumstances created by the bovine TB outbreaks, the normal deferral timeline was not sufficient for affected ranchers. Indeed, due to the extent of the destruction of herds resulting from the bovine TB outbreaks, affected ranchers faced difficulty in replenishing their herds within the one-year timeline. They were faced with replacing a high volume of animals and the lack of availability of quality mature breeding animals.
For this reason, the Minister of AAFC wrote to the Minister of Finance in 2017 and 2019 seeking tax relief for impacted ranchers who received compensation for the forced destruction of their livestock due to bovine TB outbreaks in the form of extended income deferrals, so as to alleviate the tax impact resulting from the timing mismatch between the payment of compensation under the HAA and the replacement of herds spanning several years.
On November 6, 2017, AAFC announced the Tax Relief for Ranchers Affected by Bovine Tuberculosis where the tax paid or payable on the difference between income computed under existing tax deferral provisions and income computed under the deferral set out below would be remitted for impacted ranchers, along with any associated penalties assessed or interest accrued.
For greater certainty, the deferral set out below is in addition to the existing deferral allowed.
| Alberta and Saskatchewan | British Columbia | |
|---|---|---|
| 2017 | 100% | |
| 2018 | 17% | |
| 2019 | 6% | 100% |
| 2020 | 17% | |
| 2021 | 6% | |
| 2022 |
The above schedule was developed by AAFC in consultation with industry and is meant to reflect the repopulation plans and the timing of replacement purchases determined in 2017 and adopted in 2019 in respect of British Columbia.
As a result, the deferral effectively gave affected taxpayers the option of including the compensation received under the HAA in respect of bovine TB for those years in their income, as set out below, with the full amount having been included by the 2020 tax year for Alberta and Saskatchewan ranchers, and by 2022 for British Columbia ranchers.
Alberta and Saskatchewan:
- 2016 and 2017 tax years: no amount of compensation received included in income;
- 2018 tax year: 83% of compensation received included in income;
- 2019 tax year: 11% of compensation received included in income; and
- 2020 tax year: 6% of compensation received included in income.
British Columbia:
- 2018 and 2019 tax years: no amount of compensation received included in income;
- 2020 tax year: 83% of compensation received included in income;
- 2021 tax year: 11% of compensation received included in income; and
- 2022 tax year: 6% of compensation received included in income.
Implications
Alberta, Saskatchewan and British Columbia ranchers are eligible for the tax relief. Affected ranchers would have most likely already filed their tax returns for the relevant years on the basis of the deferral schedule set out above and the Canada Revenue Agency is administering the tax rules. The cost to the Government is the time value of the deferral of the tax revenue associated with the deferred income and is below $1 million. The Order comes into force on the day on which it is made and applies retroactively to the 2017 and subsequent taxation years for affected Alberta and Saskatchewan ranchers and to the 2019 and subsequent taxation years for affected British Columbia ranchers.
Consultation
The deferral schedule set out above for Alberta and Saskatchewan was included in the AAFC news release announcing this tax relief and was developed in consultation with affected ranchers regarding repopulation plans and replacement purchase schedule. No comments were received in response to the news release. In 2019, AAFC consulted affected ranchers in British Columbia in developing the British Columbia deferral schedule. It was decided to use the same deferral schedule as for Alberta and Saskatchewan, for reasons of fairness, since the conditions faced by British Columbia ranchers did not appear to warrant deviating from that schedule.
Contact
Hyacinthe Huguet
Advisor
Tax Legislation Division
Tax Policy Branch
Department of Finance Canada
Email: consultation.legislation@fin.gc.ca