Potential factors affecting competition for private land between Forestry and Agriculture in Canada

• Author / Creator

  Tshuma,Patience Silundi

• This study assesses two factors which could influence the competition for private land between agricultural crops and hybrid poplars in Canada: tax policy and investment portfolio diversification. I find differential treatment of trees for property tax purposes across provinces, but negligible differences with respect to income taxes. I also examine the use of Real Estate Investment Trusts (REITs) - an alternative corporate tax structure for land ownership – in the context of tree and agricultural production that could confer tax benefits to farms with hybrid poplars. I find that existing rules, such as restrictions on foreign ownership of land and non-recognition of timber cutting contracts as rental income, pose significant barriers to farmland and timberland-based REITs. Lastly, I estimate a Capital Asset Pricing Model to compare the systematic risk added by farmland and timberland to a diversified portfolio. Both assets have zero betas indicating neither is favored on private land.

• Subjects / Keywords

  • Competition for private land
  • Real Estate Investment Trusts in Canada
  • Capital Asset Pricing Model in Timberland
  • Income tax and forestry
  • Capital Asset Pricing Model in Farmland
  • Propert tax and forestry

• Graduation date

  Spring 2014

• Type of Item

  Thesis

• Degree

  Master of Science

• DOI

  https://doi.org/10.7939/R36H4CZ8C

• License

  This thesis is made available by the University of Alberta Libraries with permission of the copyright owner solely for non-commercial purposes. This thesis, or any portion thereof, may not otherwise be copied or reproduced without the written consent of the copyright owner, except to the extent permitted by Canadian copyright law.