TORONTO March 1, 2005 - The
Provincial Liberals and Toronto City Council
have cooperated in taking another tax whack at small business. Years
ago
the provincial government had promised to reduce that portion of the
commercial property tax bill which it sets for education. The
promise
related to the anomalous situation in which Toronto property contributes
about 28% more than the surrounding 905 area, and disproportionately more
than the provincial average. Those excess taxes are not used for
education
in Toronto, but are spent elsewhere in the province. This leaves a heavy
tax
burden on all commercial property within Toronto, but especially on the
small businesses whose assessments have sky-rocketed under the Province's
system of current value assessment. The promised reduction has not
been
implemented and many of those businesses have been coping with five
percent
increases year after year.
Now the province and the City
have agreed to impose another 1.5% increase
in the rate on these same businesses. For the past five years these
businesses have seen their property taxes increase at a rate double and
triple the rate of inflation. The largest increases have been
implemented
since Mayor Miller was elected, although he promised during his election
campaign to reduce the tax burden on small business. To make matters
worse,
the minority of businesses whose assessments have declined have been
deprived of all but nominal tax reductions.
"This policy of taxing
commercial property to the max cannot go on much
longer, simply because it destroys its own base", says John Wakulat,
President of the Toronto Association of Business Improvement Areas (TABIA).
"All across the City, commercial operations, primarily stores,
boutiques,
and restaurants, are being replaced by condominiums and street
town-housing,
sometimes a whole city block at a time. It is happening from
Yorkville to
Weston Road, from Dundas in the Junction area to Danforth east of
Greektown,
from Lakeshore Blvd to the Beaches. The City of Toronto is becoming
a
bedroom community for its suburbs. As commercial property has
historically
contributed most of the City's tax revenue, it remains to be seen how the
City will be able to function as that base erodes." Wakulat
also expressed
dismay that the Liberal MPP's representing Toronto ridings do not speak up
for the City on this issue.
