Real estate firm says N.B. tax proposal dangerous for small business

A leaked memo from commercial real estate firm Turner Drake and Partners is suggesting to clients that a proposed amendment to the New Brunswick system of property tax assessment could be dangerous to small business.

In an internal ‘Action Alert’ memo provided to Global News says that if Bill 9 is passed some businesses will “see massive property tax increases.”

The memo argues the broad wording of the bill could mean “racking, coolers, cash registers, computer hardware, MRI machines” could all factor in to property tax assessments.

“Consider the value of your equipment, storage racking, display coolers, and other installations and recalculate your tax bull assuming the value of these items will be included in your assessment,” the memo reads.

Saint John Harbour MLA Gerry Lowe, who sponsored the bill, says the Halifax based firm should be “embarrassed.”

“It’s a scare tactic that they’re trying to scare the small business people and residentials and workers into thinking that everybody is going to have this great big tax,” he said.

“They know cash registers and restaurants and stuff isn’t [going to be] taxed. We’re talking about heavy equipment, heavy machinery outside a building that services the building.”

Ron Marcolin of the New Brunswick Employers Coalition says the memo is just an attempt to keep clients informed about a piece of legislation that may affect them.

“Quite frankly it’s a prudent business decision decision for a professional services firm like turner drake to tell their members, in other words their clients, what exactly is happening with Bill 9,” he said.

“I think it’s very prudent that they inform their customers, in essence, on what exactly it is and what their concerns are, not unlike other memos that are sent on a very regular basis from banks, from lawyers, from accountants… You expect your service provider to give you information.”

Lowe insists that the changes are not aimed at small business but Marcolin says employers in the province are worried by the bill’s broad wording.

“The way it is currently tabled at the Legislature we believe it is big and broad. That’s the way it’s written, that’s the way it has been proposed and that’s the way people in New Brunswick are taking this,” he said.

“We don’t believe it’s fear mongering at all, we believe that we’re reacting clearly to what has been proposed and obviously we object to it. We do not believe it’s the right way to do business. We believe it is [putting] New Brunswick at a competitive disadvantage and that’s something we clearly don’t need in this province.”

Lowe formerly served as a Councillor for cash-strapped Saint John, in many ways the ground floor of the debate over the taxation of industry in the Province. Lowe and many current Councillors believe that the property tax exemptions afforded to big industry in the city have unfairly shifted the tax burden to home owners.

“I know how bad the tax rate in Saint John is–people are moving out, are abandoning houses and just leaving and people are coming in and stealing the copper. And we figure that there could be as much as two billion dollars worth of heavy equipment and machinery,” he said.

“You’re talking a tax bill that could drop down to below a dollar or just a little bit above a dollar. What a relief that would be and what it would do for the city… We’re just looking for fair taxation.”

Lowe added that the bill, which has support from both the People’s Alliance and the Greens, is still in it’s early stages and says he hopes to see industry come forward so a constructive amendment can be reached.

But Marcolin says employers are unlikely to support the bill in any form.

“We are fully against this bill in any shape or form because this again is a deterrent to invest in New Brunswick, this does not allow New Brunswickers to continue to invest in their own province,” he said.

“This again is another tax, another cost. We have escalating costs on a variety of fronts, this would give us a competitive disadvantage.”

When reached by phone André Pouliot declined to comment on the memo, calling it an internal document meant for clients only.

Source: Read Full Article