Calgary City Council opts not to reduce corporate tax hike
A decision to leave the residential-to-non-residential tax ratio unchanged has left the Calgary Chamber of Commerce “discouraged”.
On Tuesday, the city council voted to keep the ratio at 52 percent residential to 48 percent nonresidential, rather than shifting more taxes to residential property.
The council debated adjusting this year’s tax hike with the stated goal of easing some of the pressure Calgary’s corporate sector is feeling.
Ultimately, the motion to maintain the relationship was accepted.
“We view the decision to maintain the status quo as a decision in favor of further imbalance as the ratio is expected to continue to increase,” said Deborah Yedlin, president and CEO of the Calgary Chamber of Commerce.
The city has already approved a 4.4 percent tax hike for 2023, but some, including the chamber, said a postponement was needed to help the corporate sector.
In addition to the approved scenario, the administration put two other possible scenarios on the table. One was to shift the equation to 53-47, which would have cost the owner of a $555,000 median home an additional $46 in taxes this year.
The other option, a move from 54-46, was also considered. That would cost the same homeowner an additional $93 in taxes in 2023.
However, since the Council voted to maintain the status quo, the other options were not voted on.
The council split over the upcoming route
The council was divided on how to proceed.
Calgary Mayor Jyoti Gondek said she believes the council needs to take action to help the city’s small businesses, adding that these businesses make up 95 percent of the city’s business community.
“I can tell you the Chamber has done a pretty good job of determining that companies with fewer than 20 employees, companies that have been in operation for less than 10 years and companies that are run by visible minorities are at greatest risk are when we take no action,” she said.
District 11 district. Kourtney Penner said she too advocates change to help the business world. She said while she was in favor of moving that equation to 54-46, she felt moving it to 53-47 was a good compromise.
“I think we realize where we stand when it comes to balancing what we’re hearing from residents and homeowners, but also what we’re hearing from the business community,” she said.
Other council members opposed the move.
“I don’t see shifting the tax rate now is the best decision for council and increasing that burden on Calgarians,” Ward 1 Coun said. Sonya Sharp, who said she prefers to keep things the status quo for now and reevaluate the conversation later in the year.
District 13 district. Dan McLean also said he will vote not to move.
“I’m pretty sure I do [councillors are] by looking at their inboxes and speaking to residents that they will not consider shifting taxes to residents,” he said.
In the end, the council voted to keep the current formula, eight of which included the council. Wong, Sharp, Dhaliwal, Chu, Chabot, McLean, Pootmans and Wyness in favor while Mayor Gondek, Coun. Mian, Spencer, Carra, Walcot, Penner and Demong were the seven opponents.
Advocating a postponement remains priority: Chamber
Yedlin previously told CBC News that the two-percent shift is sellable given the benefits it would bring to the city’s economy, adding that the chamber remains committed to a two-percent shift in the property tax for years to come percent will use.
She also cited an administrative report that said commercial property owners pay a higher percentage of the total tax bill in Calgary compared to other cities across the country.
“We have actively worked with our business community and the City Council on the importance of business viability and success in Calgary, knowing that a thriving business community leads to a vibrant Calgary community at large,” said Yedlin.
“We need a strong business environment to continue to have a strong economy.”
City officials had been trying to make a quick decision on the ratio as they need to prepare tax bills for mailing in May.