The Canadian Federation of Independent Business (CFIB) claims B.C. small businesses pay almost three times more tax than residents on similarly priced properties.
In a study released Tuesday morning, it recommends that municipalities freeze taxes on business properties until the tax gap falls into a more acceptable range; a maximum ratio of two to one.
“If municipalities do not make significant progress by 2012, the province should step in to legislate a cap on municipal business property taxes as they did for railway and port properties,” said the study.
The worst tax gap in the province is in North Saanich, according to the CFIB, where small businesses pay almost seven times more tax than residents.
Other municipalities with large gaps include Coquitlam (4.98 to 1), Vancouver (4.84 to 1) and North Vancouver City (4.09 to 1).
Among B.C.’s 30 largest municipalities, where 82% of the population resides, the average gap is 3.30 to one. Businesses pay more municipal property taxes than residents in 157 of 160 B.C. municipalities. For an average property in Vancouver worth $944,916, a resident pays $3,950 while a business pays $18,376 in total taxes.
In 1990, the average property tax gap was 1.80, said the study. In 2009, the gap reached 2.94 to 1, a 0.03 improvement from 2008.
Brian Bonney, CFIB’s director of provincial affairs, said: “Introducing a fair cap to business municipal property tax rates has been done in Ontario, and it can be done in B.C.”
He added that Toronto has committed to a 2.5 to one tax ratio by 2013 and that Saskatoon narrowed its tax gap to 1.75 to one in 2010.
The CFIB’s full study, and regional backgrounders covering all municipalities in B.C., are available on CFIB’s web site: www.cfib.ca/bc.