B.C. shelves planned tax relief for towns that depend heavily on industry
Announcement at UBCM meeting met with anger from small, medium sized communities
by Jeff Lee, Vancouver Sun September 28,2010
WHISTLER – The provincial government has shelved a proposal for tax relief for communities heavily dependent upon industries, saying the cost implications are significant.
The decision, made public at the Union of B.C. Municipalities convention, was greeted with anger and unhappiness by mayors of small and medium-sized municipalities who have faced a tax revolt from large industries who refuse to pay their property taxes.
In the 2010 Throne Speech the provincial government promised to work with local governments to come up with an equitable formula for industrial taxation in communities where a single industry makes up a significant portion of the tax base.
But on Tuesday, a UBCM panel said a proposal it drafted that would see the province kick in between $17 million and $42 million annually to resource-dependent communities over the next 10 years in return for lowering or getting rid of their Class 4 industrial tax rates had been politely shelved by Victoria. Under the proposal, as many as 32 of the 76 communities with Class 4 tax rates would voluntarily declare themselves “industrial communities”. But industry representatives wanted the classification to be mandatory, fearing a patchwork of communities across B.C. with varying tax systems.
“We did get a response, which essentially says the ideas we presented were very carefully considered,” said Kelowna Coun. Robert Hobson, the chair of the UBCM industrial taxation committee.He read from a letter he received from Finance Minister Colin Hansen this week:
“Our recommendations have significant financial implications for the province and will require consideration as part of 2011 provincial budget process.:” I guess I would take that as not being a yes but also not being a no.”
The decision is a bitter blow for municipalities that have been boycotted by industrial taxpayers, who complain they pay an unreasonable share of municipal taxes.
Last year pulp mill owner Celgar refused to pay its taxes to Castlegar, threatening a court fight. In Port Alberni and Nanaimo, paper companies Catalyst and Harmac also held back on paying millions of dollars in assessed taxes. Several of the cases are still before the courts.
Port Alberni Mayor Ken McRae said the province’s decision was a blow, and urged the UBCM to continue pushing for tax relief. The city had the province’s first sawmill 150 years ago, and “has sent hundreds of millions of dollars” to Victoria in taxation.
“We’re not here for a handout. We’re just here for a fair share,” he said.