By Jennifer Sheepy
Small businesses in Centretown are being hurt by Ottawa’s property tax system, forcing them to pay a much higher rate compared to residential buildings.
A report released earlier this month by the Canadian Federation of Independent Business (CFIB) confirmed that of the 25 municipalities surveyed across Ontario, the gap between residential and commercial tax rates is particularly large in Ottawa.
In addition, equal-valued properties pay dramatically different amounts of taxes.
According to the report, a $200,000 home would pay $3,799 in property taxes, while a commercial property of the same value can be charged as much as $11,910.
“We’re not advocating the increase of residential taxes, but you have to have a level playing field,” said André Piché, senior policy analyst for the CFIB. “There shouldn’t be a discrimination of one category of tax payers against another.”
The CFIB, whose membership includes 1,600 small businesses in the Ottawa area, along with many other local business owners, feels the gap needs to be reduced.
Jean Martin, owner of Images on Bank, says that the amount he pays in property taxes is staggering compared to the amount of services he gets.
“I’d like to see the streets be a lot cleaner, having city parking not be so expensive to encourage people to come down, and security. People are afraid,” he says.
Jeff Robinson, owner of Treats Coffee Emporium on Sparks Street, says that a high commercial property tax also makes it difficult to stay competitive. “The person who really ends up paying for it is the consumer,” he says. On top of property taxes, Robinson also has to pay for garbage collection.
Gerry LePage, executive director of the Bank Street Promenade, says there is a misconception that businesses can afford to pay higher taxes.
“It’s great to talk about boom and the boost economies like tourism and technology, but the fact is that we have a traditional economy that we still have to contend with,” says LePage.
“There are over 12,000 small business in this region and they contribute an enormous amount of tax revenue.”
LePage says that this only applies to businesses that are making money, not to ones who are just starting up or struggling to stay open.
“The idea that business has endless pockets is simply untrue,” says LePage. “In fact, the net generator of jobs is small businesses. And those are the type of enterprise that can least afford those types of increases.”
LePage says he wants more attention drawn to commercial property tax issues during the municipal election.
But he says that even if candidates agree that there is an inequity, no politician wants to shift that tax burden onto residential owners.