British Columbia Eliminates Tax Rate Relief for Commercial Property Owners

The recently presented 2021 British Columbia budget contains a change that will significantly impact property tax rates for owners of commercial property. In this year’s budget, the government confirmed that commercial property tax rates are expected to see marked increases in 2021 because of the elimination of the tax relief previously granted to owners in 2020. The commercial property tax rate reduction introduced last year was achieved through a cut to the School Tax Rate and resulted in a reduction of approximately 25% to the tax levy on non-residential property owners.

While the tax rate reduction came as welcome relief to business owners struggling under the economic uncertainty of the COVID-19 crisis, this measure was not carried forward in this year’s budget. As a result, most commercial taxpayers can expect to see hikes of between 20% and 25% as the tax rates return to pre-pandemic levels.

What does this mean for your commercial property in 2021?

Below is a snapshot of the potential impact this change may have on property taxes owing for varying sizes of commercial property. The table highlights the year-over-year increase and provides a 2021 estimate, assuming a 4% increase in addition to a return to pre-pandemic tax rates.

City of Vancouver – 2021 Property Tax Estimates

* with 4% increase in tax rate from 2019 level

These increases will be seen provincewide, though it is important to note that residential property owners will not be affected. Further information on the tax changes announced in this year’s budget may be found on Ryan’s website at: Tax Alert | British Columbia Budget 2021.

Ryan’s team of experts are available to discuss the potential impact of this recent change on your property situation. Please contact Vance Leschuk, Director of Property Tax, by email or phone at 778.789.5037 for further information.