On April 16, 2020, the Province of British Columbia (the “Province”) announced further support for businesses by introducing temporary property tax changes to assist with cash flow issues during the COVID-19 pandemic. It is expected that the latest news by the Province will reduce most commercial property tax bills by 25% on average, providing up to $700 million in relief for businesses.
Highlights from the April 16, 2020 announcement include:
Further Reduction in School Tax. A further reduction to the school property tax rate for commercial properties beyond the previous 50% reduction announced for classes 4 (major industry), 5 (light industry) and 6 (business and other) as part of British Columbia’s $5 billion COVID-19 Action Plan (the “Action Plan”). This will provide immediate relief for commercial and industrial property owners - savings that landlords will be able to pass on to their tenants under triple-net leases. See our bulletin on the Action Plan here.
Postponement to Late Payment Penalties Date. Owners, landlords and businesses with commercial properties in classes 4 (major industry), 5 (light industry), 6 (business and other), 7 (managed forest land) and 8 (recreational property/non-profit organization) now have until October 1, 2020 to pay their reduced property taxes without incurring late payment penalties. This allows owners, landlords and businesses to defer property tax payments without impacting immediate cash flow.