Business rails at plan to charge for appealing assessment

Posted on April 19, 2011 by admin

THE city is being blasted by business and taxpayers groups over a proposal to charge a $50 to $500 filing fee to property owners who appeal their property tax assessment.

Officials with the Canadian Federation of Independent Business and one of the country’s largest realty tax consulting firms said Thursday the fee could effectively deny the right of appeal to some small business owners, seniors, and low-income ea
rners who have limited resources and can’t afford even a $50 fee.

And Colin Craig, Prairie director for the Canadian Taxpayers Federation, said the proposal smacks of “gouging”. The proposal, which must be approved by city council before it can be implemented, calls for a sliding scale of fees ranging from $50 to appeal the assessment on a single-family residence or condo, to as high as $500 for a non-residential property with an assessed value of $5 million or more.

City finance committee chairman Scott Fielding defended the proposal, saying most other jurisdictions charge such fees, including the Manitoba government and the City of Brandon.

He said the purpose is twofold: to recoup some of the costs incurred in providing an appeal process, and to deter “nuisance” appeals.

He said that in the last two-year appeal cycle, more than 12,000 appeals were filed, the city spent more than $1 million to hear them, and 1,738 (15 per cent) of appellants never even showed up for their appeal hearing.

“That’s a big waste of taxpayers money, so we think it (a filing fee) makes sense.”

He also noted the fee will be refunded if the taxpayer wins the appeal.

“(So) at the end of the day, we feel it’s something that is very justifiable.”

But David Sanders, a senior tax consultant with the Winnipeg office of Altus Group Realty Tax Consultants, said the right to an appeal is a basic right that shouldn’t be restricted for any reason. “And (people failing to appear for their hearing) is part of the cost of taxing the population,” he said.

He said if the city is concerned about no-shows, there must be better ways to deter them. A filing fee ends up punishing everyone for the actions of a few.

The CTF’s Craig said there’s nothing wrong with the city charging user fees for some services, such as the use of civic swimming pools, because people don’t have to use those services if they can’t afford the fees.

“But taxes aren’t voluntary, so to charge someone an arm and a leg to have their assessment reviewed is unreasonable.”
Sanders said he plans to appear before the city’s executive policy committee next Monday, and before council on March 22, to argue against the fee.

http://www.winnipegfreepress.com/business/business-rails-at-plan-to-charge-for-appealing-assessment-117788098.html

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Manitoba drops small business tax to zero

Posted on December 9, 2010 by admin

December 1 marks the day that Manitoba transforms into a zero-per-cent small-business tax rate province in Canada.

This move by the Manitoban government was commended by Catherine Swift, president of the Canadian Federation of Independent Business (CFIB). It allows small business to keep more of their profits and reinvest in their companies, their employees and their communities.

Similar t to the personal income tax system, all business pay a reduced provincial corporate income tax rate up to a provincial threshold, which varies between $ 400,000 and $ 500,000. After that threshold, the higher general corporate tax rate applies.

But make no mistake—businesses in Manitoba still pay a host of taxes and contribute to the functioning of government. Nonetheless, this is a step in the right direction.

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Business group says B.C. municipal tax hikes driven by salary spending

Posted on February 15, 2010 by admin

Municipal salaries and benefits are the main culprit behind rising property taxes, says a B.C. small business group.

In its second annual municipal spending watch report, released Thursday, the Canadian Federation of Independent Business says that wage and benefit hikes are the main cost-driver behind growing municipal spending.

There’s a complete disconnect between the salaries and benefits in the public sector and the private sector,” said CFIB vice-president Laura Jones. “It’s completely unfair to taxpayers.” Jones estimates that municipal workers earn 10 per cent more than workers in business and industry, and 35 per cent more if you factor in benefits.

And there’s also wide variations in staffing levels, per head of population, the report shows. Abbotsford has five employees per 1,000 people, while West Vancouver has 29 and Whistler 46. “We need to start asking some questions,” said Jones. “Why does one municipality need 29 employees per thousand population, while another needs five?”

“There could be a lot more done to control costs at this level of government.”

Maureen Bader, B.C. director of the Canadian Taxpayer’s Federation, said that in North Vancouver, 91 civil servants made more than $100,000 last year, compared to 60 in 2006.

And in West Vancouver, 166 city workers made over $75,000.

“We’ve seen this across the province,” said Bader. “Self-interested pols are allowing municipal salaries to spiral out of control.”

Municipalities don’t face the same cost constraints as private industry, and can let tax-funded salaries go up without much, if any, restraint.”

Bader said most of the tax burden falls on business and industry, and in some municipalities the industry tax rate can be 20 times higher than the residential tax rate.

The CTF has called for a cap on proprety tax rates, and to create property tax rates for residents, businesses and industry.

“This will precent municipal politicians from subsidizing services to residents as a vote-buying tactic, while sending the bill to business.”

Retired financial manager Garrett Poleman, who is among a dozen members of a West Vancouver ratepayer-group, said “The big driver is definitely salaray and benefits, because that is 80 per cent of operational budgets,” said Poleman.

Hiring more staff brings higher salaries, and annual wage increases are steadily in the three-to-five per cent range.

“There’s been no barrier, no brake,” he said. “So you end up paying more taxes.”

And in Vancouver, property taxes could rise 4.8 per cent next year, and five per cent in 2011, just to cover salary increases of $26.7 million and $28 million respectively.

SFU public policy expert Doug McArthur said it’s not wages that are driving costs, but increased municipal services.

“If municipalities are growing services…you are going to see the overall wage and salary benefits growing,” said McArthur. “It’s a service sector.”

McArthur also said that big infrastructure projects like the millions spent on hockey arenas, Olympic venues and leisure complexes also hike up operating costs for municipalities.

“They are getting their capital project, but they are going to have to pay to operate them when they are finished,” he said.

Barry O’Neill, President of CUPE B.C., which represents 98 per cent of the province’s 37,000 municipal workers.

He said the CFIB numbers are being “plucked out” without back-up references.

“I don’t know where the evidence comes from,” said O’Neill. “It’s nonsense.”

Wage increases for municipal workers over the past 10 years have barely kept in line with inflation, he said, and they’re no bigger than the private sector.

A carpenter in the public sector is not making more money than a carpenter in the private sector, he said. “I never hear the CFIB talking about how you find other revenue streams,” he said.

http://www.theprovince.com/technology/Business+group+says+municipal+hikes+driven+salary+spending/2190132/story.html

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Toronto now bedroom community for 905, report finds

Posted on December 23, 2009 by admin

If you ask Les Liversidge why he left Toronto for Markham, he is quick to answer: “It was the business taxes, principally the tax bill on the building itself that did it.”

Four years ago, the 55-year-old lawyer owned a building in north Toronto out of which he ran a small firm that practised occupational safety and workers’ compensation law. His dilemma was property taxes — they had gone through the roof.

Taxes are one factor — albeit a major one — that have helped push the city of Toronto down the list on the FP/ Canadian Federation of Independent Business rankings of entrepreneurial cities. Toronto is now dead last on a list of 96, while suburban Toronto, known as the 905 district, sits at 33. The evidence is clear that businesses, some with a need to stay close to Toronto, are opting for the suburbs.

At one point, Mr. Liversidge said he was paying $4,000 to $6,000 in taxes on the 1½-storey building he occupied from 1992 to 2005, but a new assessment on the property put the tax at $65,000 to $70,000. Increases were capped by legislation but, even with the cap, his bill jumped to $27,000.

He could see the writing on the wall.

Mr. Liversidge owned a property that was only going to get more expensive to run.

There was no decision. He picked up his practice, which includes four employees, and moved to Markham — about seven kilometres away.

While the city can point to a few real estate projects that show business is still coming to Canada’s largest city, the hard statistics show it’s moving out to the suburbs.

Real estate company Cushman & Wakefield Ltd. says in 1986 the inventory of office space in the central area of Toronto was 59.7 million square feet.

It has since grown to 82.3 million square feet. By comparison, the suburban market real estate inventory jumped from 38.8 million square feet in 1986 to 83.3 million square feet today.

Judith Andrew, vice-president, legislative with the CFIB, said in her group’s rankings Toronto has been slipping because it is not doing well when it comes to policy issues.

The survey scores, which are based on interviews with CFIB members, found respondents giving Toronto low marks for the cost of local government, government sensitivity to local business, local government regulation and local government tax balance.

“One of the problems with Toronto is it has a real penchant for regulating” Ms. Andrews said.

“There are always new regulations in the works. It’s not surprising then that Toronto gets a bad rating on regulation.”

The survey found 69% of respondents said regulation and paper burden were cause for concern in Toronto. Compare that to Saskatoon, which finished first overall in the survey.

Only 58.2% of respondents in the Saskatchewan city say it’s an issue.

“There are a lot of regulations in the city that are not in other municipalities, whether it’s restaurant ratings or regulating retail establishments of a certain size having to have a public washroom. On and on it goes, they always have to have a new idea,” she said.

The impact has been more and more jobs migrating to the suburbs. “Toronto is becoming the bedroom community for 905,” Ms. Andrew said. “Look at the statistics. Unemployment is higher in Toronto than it is outside.”

Worse yet, there is very little confidence conditions are going to improve. “The city of Toronto’s spending is increasing exponentially,” she said. About the only category Toronto does well on in the survey is the diversity of its businesses.

Don’t tell anybody at Telus Corp. that Toronto isn’t the place to be. The Vancouverbased telecommunications giant is moving into a brand new building called the Telus Tower next month. It will move nearly 2,000 employees into the 30-storey building in the heart of downtown Toronto.

“For us there were two things,” said Andrea Goertz, vice-president of enterprise solutions with Telus. “It’s very close to our customers, close to the downtown core. It’s very convenient to our team members, close to buses and close to the trains.”

Telus is moving employees from 15 locations into the new location while it keeps a separate call centre in Scarborough.

The company could have consolidated in the suburbs but for a western-based company trying to make a splash in Toronto, the downtown core will always have a certain cache.

“For us it’s a central, high-profile location,” Ms. Goertz said.

“It was important that our employees have an environment where they could really thrive with the culture of the city. It was a consideration that played into our decision to be in the downtown core. We want to be part of the presence that is Toronto.”

http://network.nationalpost.com/np/blogs/toronto/archive/2009/10/19/toronto-now-bedroom-community-for-905-report-finds.aspx