HRM’s “backwards” tax system scaring businesses away: critics

Local business advocates say one business owner’s decision to sell his property in the face of rising taxes and property assessments will be the first of many – unless HRM takes steps to correct its “backwards” system immediately.

Photographer Chris Reardon is selling the Harris Studio Inc. property at Charles and Agricola streets after his property assessment – and, subsequently, property taxes – more than doubled in a 12-month period.

Some business experts say it’s one example of a system that’s inherently flawed, and will soon drive more businesses out of the downtown core and off the peninsula.

“The system almost seems backwards,” Paul MacKinnon, executive director of the Downtown Halifax Business Commission, told News 95.7. “The city…does benefit when businesses prosper in the urban core, or any area which is already serviced, and yet we seem to have a system which really encourages people to develop in areas where there are going to be ongoing service costs.”

In Halifax’s north end, where Reardon’s independent studio was located for about a dozen years, MacKinnon said there are particularly steep property assessments and tax increases.

“In theory, it’s supposed to be done based on income,” said MacKinnon. “So, if your income is not significantly increasing neither should your assessment. But you could be impacted by things happening around you. You could be impacted by the development potential of your building.”

MacKinnon says HRM should be  helping businesses cope by instituting a lower urban core tax rate, and a commercial cap which would  phase in tax increases.

Nova Scotia’s Canadian Federation of Independent Business said the taxes are a contentious issue among their members, on and off the peninsula.

“Businesses here in Halifax, on average, pay three times what a resident pays for the same-value property,” said Amelia DeMarco, noting government spending in Halifax is happening at a much faster rate than inflation and population growth.

“There’s lots of room for us to rein in that spending and to be able to bring back some balance to the property tax system,” she said.

DeMarco says every business that closes represents lost investment and jobs for the entire community.

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