Businesses are taking the biggest hit on property taxes in Ontario and real tax reform is necessary, says an association representing small- and medium-sized business owners.
A report released by the Canadian Federation of Independent Business Aug. 12 indicates little has been done to address the distortions in Ontario’s property tax system and small businesses are shouldering the greatest burden for property taxes.
The CFIB study shows industrial and commercial properties are still paying dramatically higher rates than residential properties of equal value.
In Sudbury, they point out businesses zoned commercial pay two-and-a-half times more than an equally valued residence. Those in the industrial class pay three-and-a-half times more.
The CFIB says Bill 140, the provincial legislation that froze the amount of tax revenue a municipality could collect from “overtaxed” classes, has helped make some small reductions in closing the tax gaps.
But Judith Andrew, CFIB’s Ontario vice-president, says the cap, although a good first step, still falls short.
Andrew says businesses pay a disproportionate amount of the tax bill compared to residential property owners and it is high time both local and provincial levels of government deal with the inequities.
The CFIB recommends the Ontario government bolster the hard cap of Bill 140 by extending its reach to other municipalities, instituting a mandatory small business threshold and reducing provincial education portion of property tax. They also recommend making public the available taxation data and ratios for all municipalities, and making a new deal for municipalities contingent on re-balancing the business tax load.