Vancouver’s healthy housing market may be good news for homeowners, who are seeing the equity in their property increase rapidly, but it isn’t such a positive thing for small business owners, who are finding that commercial property tax rate rates are on the rise.
According to the Canadian Federation of Independent Businesses, Vancouver business owners are paying rates which are four times higher than those charged for residential properties assessed at the same value. (The organisation is suggesting that a fairer rate for business owners would be a ratio of two to one of business property taxes to property taxes.)
Vancouver city Government has tried to address the issue of fairness for business owners by introducing a series of tax shifts in the years between 2008-2011. At one point business owners were paying six times the property tax rate homeowners were charged for properties with the same assessed value, and city Government officials have stated that they feel the changed made to date have made the tax system fair for commercial property and residential owners alike.
In a province where the vast majority of commercial enterprises are considered small businesses (ten employees or less), some owners are considering moving to areas where the property tax rates are lower. The change in location would allow them to invest more money in the business by allowing them to hire more staff or expand their premises, both of which would be good for the local economy.
While some British Columbia business owners are looking at picking up stakes and relocating to other areas, other long-time owners in the province have made a more drastic choice and have decided that it’s time to find a buyer and get out of business ownership entirely. The cost of property taxes is pushing them out of business ownership entirely instead.
