Mall businesses in B.C. pay, on average, 2.79 times more property tax than a resident must pay on the same value of buildings and land.
The Canadian Federation of Independent Business, which has compiled a detailed analysis of the property tax rates in B.C. municipalities, thinks this is unfairly high. I think it's just about right.
But I still think CFIB does a valuable service by underlining some glaring property tax inequities in B.C. I just wish they'd targeted only the cases that need fixing, and not painted all 160 municipalities with one brush.
Shachi Kurl, the CFIB's new director of provincial affairs, suggested that, based on what the organization's members say they can handle, the fair level would be a business rate not more than two times higher than the residential rate.
I think letting a group pick what it wants to pay would be an odd way to determine tax loads. And I've argued in past for a business rate of 2.5-3 times the residential rate. I base this on factors such as the ability of businesses to deduct property tax payments from their taxable income, the practices in most comparable jurisdictions and the benefits businesses obtain from amenities that enhance a community's quality of life.
And surely, no matter what they say, business "can handle" a ratio much higher than two-to-one, as they have for years in Vancouver. They didn't like it a couple of years back when it was six-to-one and they have reason to not like it at 4.55-to-one today. But they're still standing.
This brings me to the big contribution of this analysis. It underlines huge discrepancies between the rates in various municipalities -from a ratio of 6.05-to-one in North Saanich (down from 6.8 in 2009) to less than 2-to-1 in the 24 lowestranked municipalities.
This is way too big a variation to create a healthy business climate in every community, and the higher numbers are way out of line with comparative jurisdictions.
CFIB identifies 10 places with ratios greater than 4-to-1. Besides North Saanich, they are Revelstoke (5.86), Kitimat and Coquitlam (4.69), Vancouver (4.55), Tumbler Ridge (4.33), Metchosin (4.12), Castlegar (4.04), Ashcroft (4.01) and Lantzville (4.00).
Councils in these communities, and in those that trail not far behind, illustrate why it's in the province's interest to legislate a cap on the maximum ratio allowed. Or -better yet -to tie all tax rates to a formula based on the actual costs each group of taxpayers impose on their municipalities.
The handful of studies I've seen come down somewhere between the range of ratios I favour (2.5-or 3-to-one) and the 2-to-1 or less advocated by CFIB.
So, yes, there's room for discussion on what's a fair ratio. And that's where I think the focus of this analysis should be: what's fair, why, and how to get there.
Meanwhile, if CFIB members think their property taxes are too high, I understand. But it's at least as apt to be the level of spending as the ratio that drives these bills too high. This can be -and should be -another discussion.
The Canadian Federation of Independent Business, which has compiled a detailed analysis of the property tax rates in B.C. municipalities, thinks this is unfairly high. I think it's just about right.
But I still think CFIB does a valuable service by underlining some glaring property tax inequities in B.C. I just wish they'd targeted only the cases that need fixing, and not painted all 160 municipalities with one brush.
Shachi Kurl, the CFIB's new director of provincial affairs, suggested that, based on what the organization's members say they can handle, the fair level would be a business rate not more than two times higher than the residential rate.
I think letting a group pick what it wants to pay would be an odd way to determine tax loads. And I've argued in past for a business rate of 2.5-3 times the residential rate. I base this on factors such as the ability of businesses to deduct property tax payments from their taxable income, the practices in most comparable jurisdictions and the benefits businesses obtain from amenities that enhance a community's quality of life.
And surely, no matter what they say, business "can handle" a ratio much higher than two-to-one, as they have for years in Vancouver. They didn't like it a couple of years back when it was six-to-one and they have reason to not like it at 4.55-to-one today. But they're still standing.
This is way too big a variation to create a healthy business climate in every community, and the higher numbers are way out of line with comparative jurisdictions.
CFIB identifies 10 places with ratios greater than 4-to-1. Besides North Saanich, they are Revelstoke (5.86), Kitimat and Coquitlam (4.69), Vancouver (4.55), Tumbler Ridge (4.33), Metchosin (4.12), Castlegar (4.04), Ashcroft (4.01) and Lantzville (4.00).
Councils in these communities, and in those that trail not far behind, illustrate why it's in the province's interest to legislate a cap on the maximum ratio allowed. Or -better yet -to tie all tax rates to a formula based on the actual costs each group of taxpayers impose on their municipalities.
The handful of studies I've seen come down somewhere between the range of ratios I favour (2.5-or 3-to-one) and the 2-to-1 or less advocated by CFIB.
So, yes, there's room for discussion on what's a fair ratio. And that's where I think the focus of this analysis should be: what's fair, why, and how to get there.
Meanwhile, if CFIB members think their property taxes are too high, I understand. But it's at least as apt to be the level of spending as the ratio that drives these bills too high. This can be -and should be -another discussion.
