The Greater Saskatoon Chamber of Commerce is outlining how the City of Saskatoon’s recently passed budget is already affecting some businesses.
“What we’ve heard from members is many of them are receiving notice on double-digit percentage increases for their occupancy costs heading into 2024,” Saskatoon Chamber CEO Jason Aebig said.
At the beginning of December, Saskatoon city council approved its, budget which will see a property tax increase of 6.04 per cent in 2024 and 5.64 per cent in 2025.
Aebig said the property tax costs to landlords end up being passed down to tenants in the form of occupancy costs.
“It didn’t take long after council’s deliberations just 10 days ago for those notices and letters to go out,” Aebig added.
According to Aebig, it is a tough time to be a business owner. He said they will feel the effects of a Canada Pension Plan increase, an employment insurance increase, a carbon price increase and an ongoing challenge with interest rates.
“The only people you can pass those costs off to are your customers and clients, and you’ve got to find a very careful way of doing that without completely undermining whatever goals and forecasts you have.”
Aebig said the unfortunate outcome is often cuts to jobs and income.
“If the only place you have to go to mitigate the impact of these rate increases is wages, benefits and jobs,” Aebig said.
In an email, Better Brother Brewing in Saskatoon told Global News its lease has gone up a substantial amount, and it’s not sure how it’s going to pay for it.
It went on to say as business owners, they try to stay optimistic, but there seems to be no end to the challenges.
Prairie Proud, another small business in Saskatoon, said while it has yet to see any change, it knows it may come.
“Certainly we haven’t felt the effect immediately as of yet, but as our landlord would pass those costs onto us, we will start to see those costs increase over the next couple months,” owner Cole Thorpe said.
Thorpe knows what businesses are dealing with first-hand, and the pressures they are facing.
“I think a lot of small businesses are feeling the effects of lots of different things over the last few years — a global pandemic, now to rising interest rates — so property taxes is just another gut punch that we’re all having to deal with, it seems like.”
He knows that at a certain point, tough decisions may need to be made, whether it comes down to cutting wages, marketing or charitable donations.
“I really hope this isn’t just another one of those landmines that might take out another small business, and we hope to not be one of those casualties.”
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