CALGARY - Calgary has the lowest commercial property taxes of all major urban centres in the country.

A report released Friday by the Real Property Association of Canada, prepared with the Altus Group, says the estimated tax in 2014 in Calgary per $1,000 assessment is $14.11 while the Canadian average is $24.25 with Montral leading the way at $37.12.

Edmonton was fourth lowest in the country of the 11 centres surveyed at $18.

The report also found that Calgary’s estimated residential property tax in 2014 per $1,000 assessment is second lowest in the country at $6.10 with Vancouver the lowest at $3.68 and Regina the highest at $13.69. The Canadian average is $9.51.

Justin Smith, director of policy, research and government relations with the Calgary Chamber of Commerce, said the report doesn’t include the fact that Calgary businesses also pay a business tax which makes the city a higher cost jurisdiction.

“Typically when we evaluate what the overall tax burden is for Calgary businesses we include both the non-residential property tax and the business tax,” said Smith. “So Calgary is a bit unique in the sense that we have two forms of taxation. That’s something that city council decided a couple of years ago to phase out. But that phase out won’t happen until 2019.

“It’s not simply a question of municipal rates. We’re also facing high parking costs, high real estate costs, high labour costs. So overall when it comes to business inputs, it’s a pretty expensive place to do business. We shouldn’t take our eye off the ball looking for solutions to make things a little better for business.”

Richard Truscott, Alberta director with the Canadian Federation of Independent Business, said he is not sure he agrees with the report’s methodology which fails to include the extra business tax on business owners in Calgary.

“Our research shows commercial property pays three and a half times more than residential property, and more than four times once the business tax is included in the calculation, as it should be,” he said.

“Looking at taxes rates as a percentage of assessment is a bit misleading, since commercial property values in Calgary are among the highest in Canada, which results in a lower per $1,000 of value figure. The real issue is the equity in shouldering the property tax burden between residential and commercial, not the tax rate compared to property value. Are commercial taxpayers getting a level of municipal services commensurate with the amount of taxes they pay? Who is subsidizing who?”

Susan Thompson, business development manager for real estate with Calgary Economic Development, said the report doesn’t compare assessed values.

“So something that’s assessed at $100,000 in Saskatoon could be $200,000 or $300,000 here in Calgary. So this really isn’t an apples to apples comparison,” she said.

The report found that Toronto, Vancouver, and Montreal continue to post the highest commercial to residential tax ratios, which are all in excess of 4:1 while the average commercial to residential tax ratio for all 11 urban centres was 2.79.

Calgary and Edmonton were at the low end of the scale with ratios of 2.31 and 2.25 respectively.

Montreal led the country at 4.49 followed by Vancouver at 4.33 and Toronto at 4.01.

Commercial property taxes in Calgary have dropped by 1.3 per cent from last year while residential taxes have declined by 3.5 per cent. The commercial/residential ratio in the city has risen by 2.2 per cent.

In the 11 urban centres surveyed, commercial taxes are down 2.2 per cent while residential taxes have dropped by 1.7 per cent and the ratio is down by 0.5 per cent.

“Excessive property taxes on commercial and industrial properties will make Canadian cities less competitive, and ultimately reduce the property assessment base and jobs. We will continue to encourage municipalities to balance commercial and industrial property taxes with residential property taxes as a way of enhancing local and sustainable economic growth,” said Michael Brooks, REALpac’s chief executive.

mtoneguzzi@calgaryherald.com

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