Owners of commercial properties everywhere can brace themselves to pay increased property taxes in the coming new year. That is, if Government’s proposed tax reform comes into effect, President of the Institute of Chartered Accountants Anthony Pierre, says. However, the increases in some areas will be bigger than in others, because of the fact that, under the prevailing system, property tax rates differed from area to area. He warned: “The system of collection on some municipalities is somewhat tardy. “For instance, there are a number of new businesses along Ariapita Avenue in Woodbrook that were, ten, 15 years ago, residential properties. And even though the property may now be a business, the owner may be still paying a residential rate, because it has not been updated.”

Pierre said Arima and Point Fortin corporations, for instance, had been regularly updating their taxes and businesses in these areas were paying the correct taxes, based on commercial classification. “Commercial property owners in these areas will, therefore, see marginal increases, while, if the rates are properly adjusted, others elsewhere will see bigger increases.” According to the proposed new tax, commercial property owners will pay five per cent of the annual rental value of the property. As for the existing land and building taxes, Pierre said, as far as he knew, they varied from area to area, between five and ten per cent of the annual “rateable” value, which was a different classification.

If the new property tax rates were properly administered, it would achieve the objective of ensuring a more equitable taxing system, Pierre said. Pierre expressed concern, also, about where the new taxes will go.
“Will it go towards garbage collection and upkeep of the neighbourhood, as stated? Or will it go towards the Government’s Consolidated Fund, like other taxes?” He said the accountants’ institute had a long-standing peeve about the health surcharge. “This was originally supposed to go towards health, but there seems to be no direct relationship between the collection of health surcharge and what is spent on the health sector.

“Apparently, the money goes into the Consolidated Fund.” Pierre said the Road Improvement Tax suffered a similar fate. “Every time you buy gas, you pay a road improvement tax. But where does it go? “It is hoped that the new property tax will be separately identified and utilised for community improvement.”