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Sidney considering further shift of commercial tax burden toward residential

Council votes tonight (April 11) on committee recommendation to approve shift
Sidney municipal council Monday will consider a recommendation that would start shifting the tax burden away from businesses and towards residents. (Google Street View)

The tax burden in Sidney could shift away from commercial and more toward residential property owners, if council approves a committee recommendation at tonight’s (April 11) regular council meeting.

The shift calls for Sidney to gradually reduce the difference in tax rates between residential and business property classes over the next 10 years, using what staff call a hybrid rate-setting method, starting in 2023.

“For example, if business and light industrial properties constitute 10 per cent of our tax base, the (municipality) would collect 20 per cent of its taxes from those properties,” explained Andrew Hicik, Sidney’s director of corporate services and chief financial officer. “Currently, this percentage is closer to 25 per cent.”

Phrased differently, the proposed policy change would lessen commercial property owners’ historic subsidizing of residential taxpayers.

RELATED: 2022 budget for Sidney increases revenue from property taxes by 3.76 per cent

It would also mark the latest readjustment in the tax burden between property classes, with supporters expressing hope it would bring consistency and predictability. Current and past councils have a history of having to lower the share paid by businesses, with perhaps the most notable intervention coming in 2020, when council passed a 10-per-cent reduction for business properties to help them weather the COVID-19 pandemic.

Sidney carried that reduction for businesses into 2021 and 2022, with money coming from government COVID relief funding.

Hicik said during an April 4 presentation to council sitting as committee of the whole that the 10-per-cent reduction has gone a long way to bring commercial tax rates closer to residential rates. The municipality has two choices for creating a more level playing field, he said, shift the burden to the residential base or reduce spending (with benefits accruing to business) and services.

“Looking at the phase in, no one wants to pay more taxes, but there are very, very modest shifts to the residential class,” he said. “We are talking $30 a year. I hate to say it, but that is nothing. That’s $2.50 a month to make a difference for the business class.”

Mayor Cliff McNeil-Smith and Couns. Sara Duncan, Scott Garnett and Peter Wainwright approved the staff recommendation, with Couns. Barbara Fallot, Terri O’Keeffe and Chad Rintoul opposed.

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Wolf Depner

About the Author: Wolf Depner

I joined the national team with Black Press Media in 2023 from the Peninsula News Review, where I had reported on Vancouver Island's Saanich Peninsula since 2019.
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