Council's new proposal does not fix property tax system

June 4, 2019

This was originally published as on opinion column in the Calgary Herald on June 4, 2019.

The Calgary Chamber, for 128 years, has been an advocate for the business community at all levels of government. Government decision making, at all levels, has a significant impact on a business’s strategic plan, financial profile and overall viability. Government policy can make or break a business, which, in turn, can make or break a family. Because as we all know, vibrant businesses create vibrant communities and households.

Last week, we saw an example of how government leadership and decision making, or more accurately, a lack thereof, can have a significant impact on a local business community.

The issues with Calgary’s property tax system are not new. The business community has been working with the city to address them since 2017. Throughout this period, the chamber has advocated for the city to take a long-term approach to address the structural imbalance between residential and non-residential property owners, while in the short-term mitigating the impact to property owners.

The new notice of motion that council has indicated it will bring forward in June may provide relief. However, it is disappointing that councillors only acted once tax bills were received and following significant pressure from the news media and business community advocates.

To their credit, earlier in the process, there were some councillors who brought forward solutions that would have improved the tax system. However, council collectively failed to recognize the merit of these options.

Unfortunately, even with the emergency measures that councillors are considering, they still have not fixed the structural problem with the tax system. Instead, they are trying to pass the problem onto others, and not take ownership of what is a City of Calgary problem.

While the new measures announced will provide relief for some businesses, we still don’t have a long-term plan to fix the structural problem with the property tax system.

Council’s repeated failure to address this has gotten us to where we are today with many businesses facing double-digit tax increases for the third consecutive year.

There are no unintended consequences here. Throughout this process, council knew what the result of inaction would be.

Council cannot pass this notice of motion and think that solving the systemic problem can be put aside for another day. The property tax system needs to be addressed immediately so that they don’t find themselves working against the clock again next year. This is a City of Calgary issue that needs to be solved by Calgary’s city council.

Even with a last-ditch attempt to provide tax relief for 2019, Calgary city council has shown an astounding lack of leadership on this issue and has failed the business community. To say that we are disappointed is an understatement.

Looking forward, there are no easy choices, but city council knows what the solution to the problem is. Fixing the imbalance in the property tax rates will require council to put good policy over politics and make some difficult decisions. Decisions that they have been entrusted to make.

We need our elected officials to step up. They know what the problem is: a property tax system with underlying structural issues. There are clear steps that must be taken to fix the system and make Calgary a more competitive place to operate a business.

On behalf of Calgary’s business community, we implore city council to show the leadership that they were elected to provide and work with the chamber and other community partners to find a solution to our city’s tax problems so that we are not in the same position another year from now.

Sandip Lalli is president and CEO of Calgary Chamber of Commerce.