Small Business

A Letter to Minister Oakes Regarding Current Tax Policies Hurting SMEs and the Neighbourhoods They Serve

(Sent) July 7th, 2014

Hon. Coralee Oakes, Minister of Community, Sport and Cultural Development

Room 124, Parliament Building, Victoria, BC V8V 1X4

 

Dear Minister Oakes:

Re: Property Taxation – Split Assessments 

The Hastings Crossing Business Improvement Association (HxBIA) would like to bring to your attention a property tax assessment issue that is impacting the retail and commercial small businesses in many Vancouver commercial districts and neighborhoods. It is making it difficult for retail small businesses to survive, and for many commercial property owners to find tenants for their buildings.

Under current BC Assessment policy, any commercial site, which has a 51% or greater chance to be redeveloped, must be assessed in terms of land value for the potential unbuilt density. In most instances, the unbuilt density is residential, which has the highest valuations. At the same time, because the current uses are usually only commercial, the additional residential is classed at the much higher commercial tax rate. As a result, many retail commercial districts in Vancouver neighborhoods that are redeveloping are being hit three times:

– They are taxed for unbuilt density;

– The density is being valued at the highest potential use (residential); and

– The density is being classed at the much higher commercial tax rates.

Property tax bills in these areas are increasing rapidly and driving out businesses, particularly small independents, as tenants are responsible for paying the taxes. This in turn is making it difficult for commercial property owners to find tenants, resulting in higher vacancies and the decline of some shopping streets and commercial districts.

We ask that your Ministry and BC Assessment consider adopting split assessments as a policy. Under this approach, the unbuilt density would still be assessed and taxed. However, BC Assessment would have to class the unbuilt density as it is valued. If the additional density is valued as residential, it would have to be classed that way as well. This would result in more reasonable property taxes for small businesses.

Small businesses are the economic lifeblood of Vancouver. Our neighborhood commercial districts are the heart of our individual communities, and their viability and vitality is threatened by the continuation of inequitable tax policy.

We look forward to your consideration of this request, and to working with staff to further the initiative in obtaining split assessments.

 

Sincerely,

Wes Regan                                                

Executive Director

Hastings Crossing BIA

 

 

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