Tuesday, April 14, 2020
by Franco Terrazzano, Canadian Taxpayers Federation
(This column originally appeared in the Calgary Sun)
Calgary councillors have the funds to help struggling families and businesses weather this economic storm. They just need the political will to make it happen.
City council recently approved a property tax deferral plan that allows Calgarians to postpone property tax payments penalty-free until the end of September. For small business owners struggling to keep staff employed or parents that are worried about putting food on the table, not having to pay property taxes until Sept. 30 is welcome news.
But if Calgarians can’t afford their property tax bills today, there’s serious risk that taxpayers won’t have the available funds to pay a higher tax bill a few months from now. That’s why council needs to provide true tax relief by reducing the overall tax burden, not just kick the tax can down the road.
During council’s last meeting Coun. Jeromy Farkas, supported by Coun. Sean Chu, pushed for more tax relief.
“This proposal to still increase property taxes by seven and a half per cent but offer deferrals is just not acceptable,” stated Farkas.
Council shot down Farkas’ proposal 13-2.
A common pushback to offering more tax relief was that the city is legally obligated to balance its budget. Essentially, the city is saying it doesn’t have the funds to give taxpayers a break.
To fund this year’s budget, the city requires $1.9 billion worth of property taxes. With the recent tax shift that means the city still needs to collect about $82 million from homeowners and about $76 million from businesses every month. This may sound like a lot of money, but the city has the funds to provide short-term tax relief. The only thing lacking is the willingness of councillors to lower tax bills and make life a little easier for Calgarians.
Currently, the city has $76.5 million set aside in a corporate slush fund. Council uses this slush fund to give Calgarians’ tax dollars to hand-picked businesses. Even during the best of times, using tax dollars collected from current Calgary businesses to fund their potential competitors is bad policy. But during this crisis, it’s not fair for the small business owners who may never open their doors again to see their money doled out to city hall favourites.
Council could provide all Calgary businesses or almost every family with a month-long property tax holiday by simply using the $76.5 million that is being hoarded in the corporate slush fund.
The city has other money set aside for future projects. As reported by LiveWire Calgary, the city has $25 million set aside for the Arts Commons expansion. Last year, the city approved about $20 million for planning and designing Foothills Athletic Park, which would include a new fieldhouse. As reported by Postmedia in January 2019, the city expected to chip in $52 million annually towards the Green Line LRT. This followed council’s 2017 approval to set aside $23.7 million each year for Green Line costs. Any tax dollars set aside for these projects should be redirected for urgent relief.
After public outrage on bungled art projects, city council voted to suspend its art program in 2017. But instead of completely ending the program, council has been storing millions of dollars in an art reserve that could now be directed for relief.
We will recover from these difficult times. When we do, we can all go back to arm wrestling over which future projects and programs should go ahead. But until then, Calgarians need their elected officials to prioritize urgent relief above future nice-to-have projects, public art reserves and a fund that forces Calgary businesses to pay for potential competitors.
Franco Terrazzano is the Alberta Director of the Canadian Taxpayers Federation.
For more information:
Franco Terrazzano, CTF Alberta Director Cell: 403-918-3532
Email: email@example.com Twitter: @franco_nomics