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Politics

BC Liberals introduce bill to cut property tax on ‘air’ over businesses

The B.C. Liberals are proposing changes to how airspace is taxed in an effort to help relieve property tax pressures on small businesses. Richard Zussman reports.

The BC Liberals have introduced private members’ legislation that would, if passed, enable local governments to reduce property taxes on unused airspace above current small businesses through a new commercial property sub-class.

Currently, local businesses pay property taxes based on the highest and best use of the land.

BC Liberal MLA Todd Stone says his legislation has broad support from stakeholders and municipalities.

“Many small businesses, arts groups, and non-profits—most notably in the Lower Mainland—are facing huge tax spikes on the air above their heads,” Stone said.

“In some cases, organizations have seen 200 to 300 per cent increases in property tax bills.”

READ MORE: ‘A huge amount of stress’: Vancouver businesses say property taxes have them at the brink

Opposition legislation rarely passes but if the government supports the bill it would create a new commercial property sub-class that local governments can use to provide property tax relief.

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The idea was endorsed at the Union of B.C. Municipalities conference.

The BC Liberals say small business owners should not be taxed based on the speculation value of the property.

There has been an increase is store and restaurant closures on Broadway, West Broadway, Robson streets as well as other areas in Metro Vancouver.

Stone describes the legislation as a tool for municipalities which will allow them to set a different tax rate for unused rates.

Taxes driving businesses out of Metro Vancouver
Taxes driving businesses out of Metro Vancouver

“There is a broad coalition of support for what we believe is very good public policy,” Stone said.

“The bill provides maximum flexibility in the use of the tool. It is at the sole discretion of local government about whether they want to use the tool and what rate of tax would be applicable to best address the unique circumstances.”

Municipal Affairs Minister Selina Robinson said she has not had an opportunity yet to read the legislation. The B.C. government put together a working group to look at barriers and one of the suggestions was to give municipalities more power to adjust the property tax rate.

Alarm over skyrocketing property taxes in Burnaby
Alarm over skyrocketing property taxes in Burnaby

The province is working on providing permanent relief for small businesses, said Robinson.

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“It is something we are looking at legislatively,” she said.

“We have identified some long term solutions that require some more work to make sure they deliver. We are also at some interim solutions that will deliver for these small businesses.”

The province is attempting to put the changes in place before the 2020 tax year. Robinson says they are “working towards that goal” but still haven’t come to the solution.

“Unfortunately the previous government took zero action on this file, so we are playing catch up,” Robinson said.

The Canadian Federation of Independent Business (CFIB) says nearly one-third of B.C. businesses are advising against starting a small business in their community because of high property taxes.

“Simply put, this bill is good public policy and has wide stakeholder support,” said CFIB Western Economist Aaron Aerts.

“The current ‘tax on air’ is making it more difficult than ever for B.C. businesses to make ends meet. Unless we make a concerted effort to help local shops and cultural spaces that play vital roles in their communities, they will continue to be forced to close their doors,”