Business council didn't request property tax cuts
Susan Holt says the tax savings may not be reinvested in the province
The head of a leading New Brunswick business organization, whose members stand to gain millions in proposed provincial property tax cuts, expressed doubts about the provincial government’s new tax plan.
"I get concerned when there's benefits to places that haven't requested such a benefit," said Susan Holt, the chief executive officer of the New Brunswick Business Council.
Holt’s comments on Tuesday came as Finance Minister Blaine Higgs continued to remain silent on the topic despite repeated questions directed at him in the legislature.
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The New Brunswick Business Council, a group that includes many of the largest recipients of the property tax cuts, including NB Power, J.D. Irving Ltd., Irving Oil Ltd., McCain Foods Ltd., and others, has not made any representation to the provincial government about property taxes being too high, Holt said.
Last week, Local Government Minister Bruce Fitch introduced a four-year plan to cut provincial property tax rates for business, rental, farm and cottage properties by an estimated $49 million.
Business rates are to be cut 15 per cent and although several thousand companies will benefit, a review of 2012 property tax assessments by CBC News showed the heaviest advantage would go to several large property owners.
NB Power will save $1.5 million alone on its property tax bill once the policy is fully implemented, followed by J.D. Irving Ltd. ($800,000) and the Potash Corp. of Saskatchewan ($600,000).
"It’s revenue we [New Brunswick] could have continued to collect," Holt said.
Last January, the province’s finance minister flatly dismissed property tax cuts as unaffordable. In the legislature on Tuesday, Opposition Leader Victor Boudreau, a former finance minister, repeatedly asked Higgs for his opinion on the issue.
"My question is for the minister of finance: What has changed so that the government can now allow these huge concessions," asked Boudreau in one of six straight questions to Higgs that were each intercepted by Fitch.
"I know that the member opposite is reading a news story and that is where he is getting his information," replied Fitch who said the policy would help 16,000 businesses, not just large landowners, including several he listed from his own riding.
"Riverview Funeral Home, Riverview Tire Services, King's Crown Hair Styling, Dents and Stones Automotive, Damascus Coffee. the list goes on and on," said Fitch
According to the website propertize.ca, the five businesses listed by Fitch occupy properties with assessments that will qualify for tax cuts of between $487 and $2,393.
Boudreau accused Fitch of blocking Higgs from answering any questions about the tax cut.
"I know why the minister of finance is not getting up on this issue. It is because the government is scared of what he is going to say," said Boudreau.
Fitch said government expects the tax cut will spur economic activity and lead "companies to add employees" but Holt said she's not sure that will be the end effect.
"Sure, you save Costco $100,000 [in property taxes] and they reinvest $100,000 back here in New Brunswick? I don't think it plays out like that," she said.