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Bigger tax hike coming for Vancouver businesses in 2012

December 19th, 2011 · 16 Comments

For the last several years, Vancouver businesses have seen their taxes significantly lowered and even, in some years, frozen, as a result of the city’s policy of shifting the proportion of taxes between businesses and residents.

It appears that’s going to change significantly this year. Many people understood during the election that a new Vision council would do one final year of shifting a full one per cent, as it has the past couple of years. Certainly that was what I thought was being talked about. The difference between the two parties, as I comprehended it, was that Vision would only do one more year of the one-per-cent shift, whereas the NPA was promising to continue shifting for all three years.

As it turns out, Vision’s new budget is planning for only a .25 shift, because that, according to the financial wizards, is all that it will take to get the tax ratio in Vancouver to 48 per cent for commercial, 52 per cent for residential.

Last year, because the tax increase was so low, the one-per-cent shift meant that businesses saw essentially no tax increase. The year before that, it was extremely small.

This year, in contrast, they’ll see almost the same increase as the rest of the city, since the shift will be so low.

Be prepared for a lot of sturm and drang over this. The Fair Tax Coalition and business owners say that Vision Vancouver has misunderstood what was originally recommended by UBC professor Stan Hamilton five years ago — that he only said to stick with the 48-52 target and stop tax shifting if there was no longer a wide disparity between Vancouver and other municipalities.

Raymond Louie and others Visioners say that’s not true and they’re leaning heavily towards giving residential taxpayers a break for once.

The two sides will be battling it out as budget talks proceed apace for the next three months.

 

 

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