The issue of abatements
Dear Editor: Property tax abatements relieve or partially reduce property taxes for a set time.
Some say abatements reduce start up costs and offset financing for new improvements. What genius thought that up? Abatements/exemptions reduce anyone's cost.
Most tax abatement decisions are based on recommendations of planners, economic development authorities and/or pressure from vested interests. The only benefactors of abatements are businesses and individuals that get them.
When a government subsidizes business, they subvert normal, free market operations. Instead of locational and development decisions based on accessibility to markets, availability of labour, financing, etc., decisions can even lead to which municipality offers the largest abatement package. Decision makers that underestimate real comparative advantages of a municipality (lifestyle, environment, etc.) are simply acting out of desperation.
Why are abatements used at all? Do banks abate interest on financing? Smart school authorities don’t.
One answer lies in examining the winners and losers to tax abatement.
City officials desperate to attract, or appear to attract, business activity of almost any nature artificially create perceptions of being more competitive with other towns as a necessary cost. I’m sure I'm not alone in my perception that city and development officials believe, and lead others to believe, that they possess unique leadership ability and visionary insight in awarding benefits to certain property owners.
Are abatements fortune, folly or a race to the bottom?
Obviously, granting exemptions from paying property taxes means every other citizen and business are poorer yet by shifting the tax burden to every other existing household and business.
Abatements starve, deprive, constrain and erode municipal budgets that depend upon property taxes to provide critical public services (street maintenance, and police and fire protection) and highly coveted amenities (parks, libraries and community centres).
Property taxes are generally characterized as regressive meaning those with little income pay a larger percentage of that income in property taxes than do wealthier citizens. Is it fair to shift the tax burden to the less fortunate?
Surprisingly, the answer may best lie in changing attitudes like “Don’t tax him, don’t tax me, tax that guy behind the tree.”
It’s far better to eliminate corporate welfare and tax all properties so everyone pays a little and few pay a lot. Property taxes are based on ability to pay using property values as a proxy and are the most widely used tax and most stable source of revenue to support local governments.
Paying property and other taxes is a good problem to have. To paraphrase Oliver Wendell Holmes: “taxes are the price of civilization.” Wayne Llewellyn Penticton First Christmas in
Canada- 1947 I was six years old when I tried to sleep, the room was dark, and there wasn’t a peep.
Christmas Eve was here at last, in my new country that is so vast.
I hung a darned woolen sock at the foot of my old iron bed, one blanket, and no pillow for my tiny head.
Pictures of war played in my mind. A gruesome reminder I could have died.
My first Christmas in Canada in 1947, the dormitory is quiet like it must be in heaven.
Rhythmic soft breathing of other little boys, some dreams of magical toys.
As morning came with broken sleep, I had not counted many sheep.
I fumbled quietly in the dark, a strange feeling in my heart.
My sock had gone from the end of the bed, and fear set in that Santa is dead.
Silently I lay in bed, tears of sadness I did shed.
Outside I went and scanned the skies, and I prayed that Santa had not crashed and died.
To my family that abandoned me, you broke my heart till eternity.
Elders tried to make me understand Santa hadn’t changed my address in this great big land.
Man is born equal so it’s said, tells that to the Orphan in the iron bed. Tom Isherwood Olalla