BC Government Announces Interim Business Property Tax Relief Program
On Monday February 24, 2020, the BC government announced the new Interim Business Property Tax Relief program that will be effective for the next 5 years. This interim program will allow local governments to provide immediate property tax relief for the 2020 tax year. This relief will apply to small businesses, like ours at T & P Trucking, that are struggling with high lease costs as a result of years of rapidly increasing property values.
The property we lease, in the Township of Langley, has seen astronomical increases in BC Assessment’s report, averaging 21-24% increases in assessed value year over year since 2017. We believe this is largely driven by forces outside of our control and are based on standard industry or economic growth models. Perhaps the money laundering and resulting housing crisis in BC have catalyzed these increases. Regardless of the cause, the effect is the same, that commercial property taxes have increased year over year to unsustainable levels.
“Years of an out-of-control real estate market have resulted in unexpected tax spikes for many small businesses that pay property taxes as part of their commercial leases,” said Selina Robinson, Minister of Municipal Affairs and Housing. “People have been asking for help, and today we’re offering a way for local governments to provide that help. This new program empowers local governments to provide immediate relief to the small businesses and organizations most affected by skyrocketing property taxes in their communities.”
Being that our property is leased, we are bound to pay the resulting property tax through the triple-net clause of our lease agreement. If the BC government allows outside forces to skew the value of property, then controls the assessment of that value, and finally allows local government to set and charge tax on that inflated value, we are right to be concerned because we are being exploited by the government we are under. To deny relief to their own citizens and members of the public and local business means that they are working with outside forces for their own benefit and enrichment.
Municipalities and local government are dependant on businesses large and small to provide jobs to the public, to pay taxes and give back to the community is various ways. If local government does not bring tax relief to their businesses in their area of oversight, more businesses will close or move to more tax friendly cities. Without sufficient jobs, people will leave to find work elsewhere. This move by the BC government is welcome relief, however, an interim measure is not enough. BC business must be protected and ensured that appropriate relief will be provided on an ongoing basis.
I made a call to the Township of Langley today, to see how they will implement this Interim Business Property Tax Relief program by means of a future by-law, and I await their call. I would like to add my voice to the discussion of the direction the Township of Langley is taking to utilize this program to protect BC business.