The $1.50 increase brings the new checkoff to $7.00
Members of Beef Farmers of Ontario (BFO) will be voting on a proposed checkoff increase during the organization’s annual general meeting this week.
The vote, scheduled for Feb. 19 at 1:15 p.m. according to the event’s draft agenda, is in favor of or opposed to a $1.50 increase to bring the new checkoff up from $5.50 to $7.00.
$4.50 from every checkoff would remain in Ontario, which is unchanged from current levels. This money is used to fund programs and activities and maintain daily operations.
The national portion would increase to $2.50 per transaction to support research and marketing activities on behalf of the whole sector.
BFO is asking for the checkoff increase for multiple reasons, said Craig McLaughlin, the organization’s president.
One reason is to ensure all provinces are contributing equally to the national checkoff.
“Every other province is sending $2.50 nationally and Ontario is still sending $1.00, so if we move on that we’ll be on par with the other provinces,” he told Farms.com.
The organization is currently running deficits and projects future deficits.
When provincial organizations send money nationally, they can recoup some of those funds to support the local organization, said McLaughlin, who farms in Renfrew County.
If the membership rejects the checkoff increase, BFO may have to consider other necessary steps to ensure the organization’s sustainability.
“We would have to look at program cutting,” McLaughlin said.
Another reason for the proposed hike deals with the National Import Levy.
The Canadian Beef Cattle Check-Off Agency set up the levy in 2013 to collect fees on all beef, beef products and live cattle imported into Canada, equivalent to the lowest national portion of the domestic check-off on a per head or carcass equivalent basis.
So, if BFO approves its checkoff increase, the National Import Levy would rise from $1.00 to $2.50.
“If 10 boxes of beef equal one animal, currently those boxes are taxed at 10 cents per box,” McLaughlin said. “If we move to $2.50, each of those boxes is taxed at 25 cents.”
That money is collected and used to promote Canadian beef across the country.
A higher import levy could raise the price of imported beef in grocery stores. But that may encourage shoppers to buy local beef instead, McLaughlin said.