The BC Government announced on Thursday morning that it is reducing most commercial property tax bills by an average of 25%, along with “new measures to support local governments facing temporary revenue shortfalls,” as a result of the coronavirus pandemic.
“We know that BC communities and businesses are suffering from the economic impacts of COVID-19,” said BC Finance Minister Carole James. “We are providing further support by making additional temporary property tax changes to provide province-wide relief for business and local governments to help weather the pandemic, continue to deliver the services people count on and be part of our province’s economic recovery.”
James said the province is also taking “significant new steps” to support BC businesses, non-profits and other organizations through the COVID-19 pandemic by further reducing the school property tax rate for commercial properties to achieve an average 25% reduction in the total property tax bill for most businesses, providing up to $700 million in relief.
James said this latest measure enhances the 50% reduction to the provincial school property tax rate that was originally announced for classes 4, 5, and 6 as part of BC’s COVID-19 Action Plan.
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In addition, the government is also postponing the date that late payment penalties apply for commercial properties in classes 4, 5, 6, 7, and 8 to October 1, 2020, in an effort to give businesses and landlords more time to pay their reduced property tax, without penalty.
And in response to what it said are “key concerns” from local governments, the province said it is addressing cash flow and revenue shortfalls with new measures that provide additional support. These measures, it said, include:
- Authorizing local governments to borrow, interest-free, from their existing capital reserves to help pay for operating expenses, such as employee salaries;
- Delaying provincial school tax remittances until the end of the year. This will provide significant relief to local governments facing cash flow issues;
- Providing local governments greater flexibility to carry debt for an additional year.
The province said these measures will “provide local governments with the resources to meet their operational costs and required remittances” to regional districts, regional hospital districts, TransLink and transit authorities, BC Assessment, the Municipal Finance Authority and other taxing authorities.
“The COVID-19 pandemic is having significant financial impacts on all levels of government,” said BC Housing Minister Selina Robinson. “It’s going to take hard work from both municipalities and the provincial government, but working together we will get through this.”
With these new measures, Robinson said the provincial government is “giving local governments new tools as a first step to ease their financial burdens and that of businesses in their communities now, and as we look to recovery in the months to come.”
Changes to British Columbia’s property tax framework complement federal measures and build on the $5 billion BC COVID-19 Action Plan that provides income supports, tax relief and direct funding for people, businesses and services.