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Economy
Yellowknife

YK chamber calls for fairer tax distribution for businesses


The Yellowknife Chamber of Commerce is asking the city to stop increasing the proportion of property tax business owners have to pay relative to homeowners.

The chamber says changes over the past two decades are straining small businesses. 

City councillors re-evaluate the mill rate ratio, or how the property tax burden is divided among different types of property owners in Yellowknife, each spring.

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While the ratio between commercial and residential tax rates has remained relatively stable over the past 20 years, it has changed every few years to reflect general property assessments. 

Rob Warburton, president of the chamber, told councillors on Monday those changes have resulted in increasingly disproportionate tax increases for business owners.

“We’ve been taking the hit every time there’s a general assessment, in a way that residents aren’t,” he said. 

“We just want the taxes to land evenly among all the classes.” 

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A city graph shows changes in the assessment and taxation percentages between residential and non-residential properties in Yellowknife.
A city graph shows changes in the commercial-residential mill rate ratio between 2000 and 2021.

Warburton explained that while the city has maintained the relative distribution of the tax burden between commercial and residential properties, the city’s business community has shrunk while the number of residential properties has risen.

That means fewer business owners, each carrying a heavier share of the tax burden. 

City councillors Shauna Morgan and Niels Konge agreed with Warburton that increasing the tax burden for business owners, while the number of residential properties grows, doesn’t make sense. Morgan said, however, she believes taxes should remain higher for commercial businesses than residential properties.

Property type2021 mill rate
Residential5.53
Commercial/indsutrial6.28
Multi-residential12.50
Mining and quarrying15.43
Agricultural7:10
High-density parking 5:59
A breakdown of mill rates for the six classes of property in Yellowknife. (Mill rate represents how much tax a person has to pay per $1,000 of their property’s assessed value.)

Warburton stressed to Cabin Radio that the chamber is not asking for the mill rate ratio to be decreased, only that it not be increased.

Other recommendations he made to the city to address the “unfair” tax burden on business owners were adding a new property tax classification for small businesses, and committing to a mill rate philosophy in December so business owners know what to expect come tax season. 

Sharolynn Woodward, the city’s director of corporate services, cautioned councillors against developing a definitive mill rate policy in December, saying they would not yet have information on the final assessed values of properties.

Woodward said a lot of work is needed before a new property class could be added and approximately 18.5 percent of businesses in the city own their own property, meaning any property tax changes would directly benefit a small proportion of businesses.

Finally, Woodward said the city is limited by the territory’s Property Assessment and Taxation Act when changing property taxes.

The city’s next general assessment is slated for 2023.

For the 2022 tax year, city staff recommended that councillors maintain the commercial-residential mill rate ratio, which has remained at 1:2.26 since 2019. 

In December, councillors approved a 5.65-percent property tax increase for 2022. City staff forecast property taxes will grow at a faster rate in the coming years due to large projects like the municipality’s new aquatic centre. 

City councillors will decide this year’s mill rates at their next regular council meeting on May 9. 

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