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Vancouver Fair Tax Coalition

The Commercial Drive Business Society supports the Vancouver Fair Tax Coalition (VFTC) as an initiative that will help maintain the viability and diversity of Vancouver businesses in general, and Vancouver small businesses in particular — the type of business typically found on Commercial Drive. We pride ourselves on our diversity of single-location, owner-operated businesses as an alternative to the North American trend towards big-box, franchised chains. We see the shift in tax base that VFTC is lobbying for as one critical component in sustaining the viability of a diversity of unique, small businesses.

in 1983 the property tax ratio for businesses compared to residents was 2.6 to 1. By 2005 this ratio had risen to 5.9 to 1. Through the efforts of the Fair Tax Coalition this ratio has decreased to 4.5 to 1 (i.e. Business owners in Vancouver pay municipal property taxes at 4.5 times the rate paid by residents). This is ~25% more than the average rate of surrounding municipalities in the lower mainland.

A 2006 study carried out by the City of Vancouver estimated residential properties pay $0.56 for every $1 of city services they consume. Businesses, in contrast, pay $2.42 for every $1 of city services they consume. More work needs to be done to bring it to a fair and equitable level.

On March 13, 2008, Vancouver City Council voted to shift property tax from commercial to residential properties by 1% per year for the next 5 years, which has provided some relief to Vancouver business owners, but as of 2012 that shift has stopped.

Here are some good reasons Vancouver businesses want to see that shift continue:

  • An annual 1% tax shift will cost the average residential taxpayer $33 per year, or about 64 cents per week, less than a cup of coffee.
  • Attracting and retaining businesses is competitive. Every municipality wants to increase employment and their commercial tax base. Vancouver competes with other municipalities in Metro Vancouver where employers pay an average of 34% of the tax levy compared to 47.5% in Vancouver. Vancouver must be closer to parity.
  • The net number of business licences issued by the City of Vancouver over the last 13 years (1998 to 2010) has only increased by 46 while our population has increased by 83,267 during this same period.
  • In the last 7 years (2005 to 2011) the number of commercial properties built in Vancouver has increased by 215 while during the same period, the number of residential properties built has increased by 23,789.
  • Residential properties make up 83.4% of the assessed value, employer properties make up 15.9% of the assessed value, and yet employers pay 47.5% of the property taxes.
  • Property taxes for commercial properties are paid by the tenants, not the commercial property owner. Most of these tenants are local neighbourhood merchants and businesses that create and provide jobs close to home.
  • Employers recognize they should be paying higher property taxes than residential property owners, but the system is out of balance. It is no longer fair, reasonable or sustainable. Currently commercial property owners pay 450% higher for the same assessed property. For example: a residential property owner with an assessed value of $1,000,000 will pay $4,180 in municipal property taxes while the employer tenant will pay a disproportionate $18,664

Watch the video to find out why this is so important for the vitality of our neighbourhoods — residential and commercial, or visit the website to learn more.