Property tax hikes mean 'difficult decisions' for Calgary businesses, Chamber of Commerce warns

The head of the Calgary Chamber of Commerce says looming property tax hikes for businesses could be too much of a burden for companies that are already struggling.

On Thursday, the city released its update on property value assessments, which are used to determine property tax bills.

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Overall, non-residential property valueswent down about six per cent. Butmorethan 70 per cent of businesses and business property owners will see higher property taxes this year, and several thousand facehikes of more than 30 per cent from last year's tax bill.

That's because of the way the city calculatestax liabilities.

'Revenue neutral' formula

Under the city's "revenue neutral" formula, a tax bill depends on how much a property value changed relative to the overall six per cent change across the city.

While property valuesin the office category were down by 16 per cent driven by growing vacancy rates in the core retail properties saw a slight increase in total value. Industrial properties were roughly flat.

As a result,many business owners outside of downtown will face big hikes in their non-residential tax bills this year, because of their relative position to the overall assessment.

On the other hand, many companies in those emptied-out downtown office buildings will pay a lot less in property tax.

'You're just paying out more and more'

Calgary Chamber of Commerce president AdamLeggesays the timing is terrible.

"It's cumulative for many businesses. Increased minimum wage, carbon levy, you name it.They're being hit from all sides and in an environment where you've got probably in many instances lower revenues," he said.

"You're just paying out more and more, which means there are fewer abilities to create new jobs."

Leggesays some larger companies could be on the hook for an additional $100,000 or more.

"And not many companies have the ability to dig deep and pull that out of thin air. So it means making difficult decisions like: 'do I have to lay someone off to be able to make my tax obligations?'" he said.

In November, city councilearmarked $15 millionto help struggling businesses, but it's not yet clear how that money will be administered.

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