Businesses with 50 employees or less could fall under a new small business mill rate subclass.
The initiative was recently announced by the Alberta government, and on Wednesday, Nov. 7, the MD of Bonnyville said they would be jumping on board and including a 10 per cent tax rebate for small businesses in their 2018 budget.
Although details have not been released, the MD is excited about offering the opportunity to small business owners within their municipality.
“Currently, you have a residential mill rate, a farm mill rate, and an industrial mill rate. Under this new policy... you can reduce the industrial mill rate up to a certain percentage. Council is aiming to do a 10 per cent reduction,” explained CAO Chris Cambridge. ”If you qualified under this as a small business under the new regulations that have yet to be completely finished, you could be eligible for a 10 per cent reduction in your taxes.”
Although 10 per cent might not seem like much, he continued, for a small business it can mean a lot.
“If you pay $10,000 a year in taxes, 10 per cent would mean you're saving $1,000 per year in taxes. It's a bit of a rebate for the smaller crews as opposed to the bigger plants and businesses. It's something council had heard a lot about during the election. This is a brand new thing, and there are very little details out... It's an initiative that has been built into the budget should everything work out,” said Cambridge.
President of the Glendon Business Alliance and owner of Glendon Motorsports Julie Kissel, said the opportunity is a relief for some businesses within the MD.
“This change will likely, overall, result in net positives for this newly created subclass for small businesses,” Kissel noted.
“Of course, any tax rebate is appreciated by small businesses, and with recent tax burdens added by the provincial and federal governments, this is a welcomed change. They've recognized how much many of our small businsses have struggled over the past few years, and obviously value the small businesses in our area and how they contribute to our local economy, job creation, and community support,” Kissel continued.
The rebate would be available for the 2018 tax year, under the new Municipal Government Act (MGA).
Reeve Greg Sawchuk said once the MD had caught wind of the opportunity, they jumped on it.
“We thought it was important to adopt it in the very first year. There was one thing we had heard from folks when we were on the campaign trail, it was that businesses are struggling,” he said. “Anything we can do to give them a hand, I think, is necessary. This is a start.”
Sawchuk is predicting that many residential properties will also see a reduction in their property assessments by about 10 per cent, resulting in a tax break for property owners.
“Their taxes will be going down, but we didn't see the same reduction when it came to commercial or business side. We felt it was important to ensure businesses were also getting a break.”
