Quote:
Originally Posted by Hack&Lube
Can we talk about the real issue? Why is the city increasing taxes on commercial properties at a time when vacancies are at an all time high and minimum wage increases are hurting small business? Does the city just say we are going to collect X amount of tax and because all the downtown properties crashed in valuation it means all the mom & pops have to pick up the slack of the major corporate players who aren't paying anymore?
We all know that increasing property taxes on landlords only leads to them simply passing down the cost to their tenants in increased rent or operating costs.
This makes it even harder for all the small business tenants to even survive.
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As others have said, the way property taxes are calculated, it takes the assessment base from the previous year and adjusts the rate to be "revenue neutral" from the previous year. Then the City sets the budget to sort out how much money it requires, then sets the new mill rate that will collect that amount of money based on the new assessment base.
When you hear a "5% property tax increase" that's how much more revenue it's receiving over last year. When you consider say 2.5% population growth and 2.5% inflation, it's in essence "level" from the previous year to operate services.
This year, (inclusive of a small rebate from reserves) the tax change is zero. Taking in the same amount as last year.
However, the problem with the system is when circumstances like what going on now, happen.
Downtown comprises almost a quarter of the total tax revenue of the City. When it's hard hit like now and it's assessed value drops far more than the City average, non downtown commercial properties pay proportionally more with the new adjusted mill rate. Council is trying to offset this unfortunate circumstance somehow (something that would equate to a cap of a 5% increase). Even if the City reduced its aggregate tax take, in a year like this still many properties would see a heavy increase individually.
Also as mentioned the City is required under the Municipal Government Act to tax this way. It would like to see changes, but that requires provincial legislative change. No luck so far.