Tax break proposed for live-music venues

Councillor hopes to implement 50% cut for commercial properties

Live music venues, already hit hard by closures as a result of COVID-19, have been thrown a lifeline in the form of a proposal to reduce commercial property taxes by 50 per cent.

“If you thought this work was important before COVID, it’s absolutely essential now. What we’ve heard from venue owners is that there’s a real risk that, coming out of COVID, we could see dozens of venue closures,” said Councillor Joe Cressy, chair of the Toronto Music Advisory Committee, which unanimously endorsed a plan by city staff.

“If live music is central to the soul and the dynamism of the city, the possibility of losing dozens of venues is simply not palatable,” Cressy said, adding a rescue plan for the industry was already underway a year before the virus struck.

A city staff report noted: “Live music venues were among the first businesses affected by COVID, and it is expected that they will be among the last to see ‘normal’ business operations and revenues return.”

Under the plan, a new subclass of property tax, passing on a 50 per cent reduction to the property owner, would be created for buildings where live music is performed. However, the properties would have to meet strict criteria, including having infrastructure such as a stage and a sound system, a minimum of 144 days of performance annually and compensation paid to the performers.

“We don’t want a scenario whereby a bar can host a weekly cover band and suddenly claim they’re a live music venue,” Cressy said.

The tax relief, which would apply to an estimated 60 venues, would be retroactive to Jan. 1 and would be permanent, Cressy noted.

Live music venues were already under considerable pressure even before the pandemic because of rising real-estate values, which have driven up the commercial tax on those properties, Cressy noted.

City staff estimate 95 per cent of live music venue operators are tenants, and that the proposal may actually encourage new venues to open by offering tax relief to the property owners, he added. “Our hope would be that this doesn’t only help to save venues, but rather helps to encourage new venues to open, to make it more financially viable,” Cressy said.