Chamber seeks ‘equitable and competitive’ tax policy

The re-assessment of both residential and commercial properties, coupled with the increased base tax has resulted in a significant tax increase for business owners. “It kind of is a confusing tax year, which is compounded because of the re-assessment.”

He said re-assessment increases averaged around 93 per cent.

Also, chamber members are concerned about the appeal dates – when they get their assessment notice, they are given an appeal date. Many members chose not to appeal their assessments, and ended up with the tax notices, Lacert said.

“I know that many members that I spoke with, when they received their tax assessments, they did speak with either representatives of the city or others, and for the most part were informed … they phrase re-assessments as revenue neutral. And most were then told it would not result in any kind of significant increase.”

He said a good chunk of the tax increases were due to the re-assessment – property values increased so much over the last four years, that there were higher assessment. And with the city’s taxes and creation of the municipal roadways base tax factored in, on average, many business owners are seeing their total amount of taxable payment double.

Lacert indicates in his statement that there are a number of negative effects anticipated, including financial losses to landlords who have multi-year lease agreements in place with tenants, the potential for difficulties attracting new business and investment in the city, increased requests for tax abatements and reduced employment and a slowing local labour market.

The chamber is calling for the city to discuss its short and long-term plans in a number of “critical” areas with residents and business owners. Specifically, the chamber pointed to a need to address housing, health care, city services, capital plans, residential and industrial lands, and infrastructure.

For example, Lacert pointed to the $4 million the city set aside from the municipal roadways base tax. In the end, he said, he thinks many residents and businesses will appreciate the improvements.

“But we’d be just looking at that to suggest that that level of improvement be reviewed to simply see if it’s sustainable.”

Lacert said they’re looking to create a model where taxation swings are reduced and the city ends up with a model that is more predictable.

It is also recommending the city establishes an “equitable and competitive” tax policy that will guide its budgeting and taxation decisions.

“I guess and again right now I kind of discuss that very broadly, which would be either incentives or stimulus around two main areas, the first area would be around attraction. So, whether that’d be tax reductions, tax abatements to assist in attracting new business development to Prince Albert that would definitely be encouraged.

“The second would be around incentives or stimulus to have current businesses continue with further investment or development of their business, which at this time is currently a great risk because of the increases. Simply put, business owners, the impact this year is that they’ll be left going back to their operations and going back to their budgets to determine how are they’re going to accommodate these increases.”

But he said the implementation of those recommendations depend on improved communication with the city.

According to the chamber, the 2013 tax increase leaves many businesses looking to adjust their models and budgets to accommodate the hike.

The chamber asked city council during the last council meeting for a multi-year phase in of this year’s tax increase. The city has since extended the tax deadline for all businesses facing an increase to this November.

“Really from a taxation perspective, there really isn’t much that can be done for this year. You know, I think the only other option which I don’t even think is up for consideration would be to repeal the 2013 tax bylaw to re-write it to a different model, or a model that would incorporate a phased-in approach. But again, we’re so far along in the taxation process, I don’t believe that is under any consideration.”

The chamber is looking to gather more insights from its members, and would like members to forward those insights to find out what their concerns and problems are.

“What we’re definitely looking to do at this stage is focus more on the 2014 year. What this 2013 year, I guess really stands out as is some of the wild swings in the increases compared to previous taxation years.”

Once the final recommendations are complete, it will be vetted internally and then the formal recommendations will be released this fall.

tjames@panow.com

On Twitter: @thiajames

by Thia James

Chamber seeks ‘equitable and competitive’ tax policy

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