City ponders 2nd year of tax relief for businesses as Calgary Chamber of Commerce calls for longer-term fixes
'At some point, you’re going to have to pull off that Band-Aid'
As the city looks at rolling out a tax assistance program for businesses outside downtown facing steep hikes again this year, the Calgary Chamber of Commerce says more permanent solutions have to be found.
Last year, with thousands of business owners facing massive tax increases as the result of the relative decline in tax assessments in the city's hollowed-out corporate office towers, the city earmarked $45 million to cap increases at five per cent.
On Tuesday, the city's finance committee voted in favour of a similar $41-million program for this year. Council will vote on the plan later this month.
"This isn't something that can happen year after year. This is close to $50 million that the city is trying to make up, and so one the things we have been talking to the city about is what to do, how to manage this," Chamber of Commerce policy director Zoe Addington said on the Calgary Eyeopener on Tuesday.
"At some point, you're going to have to pull off that Band-Aid, businesses are going to have to pay for that increase."
Addington says the chamber would like the city to look at reducing the burden on non-residential tax payers relative to homeowners.
"One of the things we've talked to the city about is getting to a closer ratio of what residents pay compared to what businesses pay," she said.
"We think that ratio could be a bit closer. Calgary has one of the highest ratios when you compare it to other cities in Alberta and even across Canada."
With the office vacancy rate in downtown Calgary — currently at 27.9 per cent — expected to remain high for years to come, Addington says it will also be important to have discussions with the province about how much tax money it collects.
"Property tax bills are also a provincial responsibility. They use that money largely to pay for education, and we've seen certainly the non-residential side increasing," she said.
Last year's program came in well under budget, using only about $25 million of the $45 million envelope. That's because many business property owners successfully appealed their assessments, resulting in tax hikes of less than five per cent, making them ineligible for the rebate.
With files from the Calgary Eyeopener