Thursday, January 6, 2005

Pass the Buck - Blame it on the province

London businesses are saddled with Ontario's highest property-tax rates, a just-completed tax analysis shows. The study shows London businesses pay higher tax rates in all six categories surveyed than their counterparts in the province's two largest cities, Toronto and Ottawa.

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The survey comes as city hall prepares to pass this year's budget, which threatens a 7.7-per-cent tax increase.

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In contrast, London homeowners pay Ontario's fifth-highest property tax rates -- 1.6 per cent of a property's assessed value, compared to an Ontario average of 1.3.
Despite the excessive amount of money spent on entertainment, fancy new libraries, overpasses, unnecessary roads and more staff, council blames the high rates on the province, in particular the education tax:
While city officials confirm figures, they blame the education portion of the property-tax bill. It's set by the province and under it London pays a higher portion than most cities, said Mike St. Amant, city treasurer.

"We are definitely on the high end of the education side," he said.

"I think if you compared us to Windsor, Ottawa or Hamilton, without the education portion, we would not be the best or worst."

For example, in the commercial and office categories, London's education tab accounts for 2.6 percentage points of the 5.1-per-cent tax rate, or more than half, compared to two per cent for Hamilton, 1.9 per cent for Windsor and 2.1 per cent for Kitchener-Waterloo, a breakdown similar for many of the categories, he said.

When the province began setting the education portion of property taxes in 1997, it used the formula set by school boards when they last levied taxes -- they no longer do -- and that saw Londoners pay more for education.

"It is based on an old system and they have to move to a more standardized formula," said St. Amant.

To reduce the tax increase, the city must look at slashing its capital debt and staffing, since the size of government has grown every year for the past 11 years, said Macartney.
However, big surprise, this study is not likely to make any impact on the upcoming budget, at least to according to Mr.Gosnell,
But Deputy Mayor Tom Gosnell, city council's budget chief, said it's unlikely the city will cut more from this year's budget. Instead, it must work with the chamber to lobby the province and set a standard, province-wide rate for education taxes in future, he said.

"It is an opportunity for us to work with the private sector, to bring this to the attention of the province and lessen the burden here," said Gosnell. "If there is disparity we have to correct it."
Of course, the excessive tax rate in London has nothing to do with the continual lawsuits brought against the city, like these libel suits, and we must not forget that the JLC is much more important than garbage collection.

1 Comment:

MapMaster said...

"While city officials confirm figures, they blame the education portion of the property-tax bill. It's set by the province and under it London pays a higher portion than most cities, said Mike St. Amant, city treasurer."

If the city didn't pay a disproportionately high education portion, our taxes would be at best, hmmm ... average. If we can't have lower tax rates, at least we have a municipal government that sets its sights on such magnificent mediocrity.

By the way, I see it's the province's fault again for municipal taxes. Do you suppose that if we had low tax rates (just dreaming here, but bear with me), that our municipal leaders would give any credit to the province? I didn't think so.