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General News · 3rd May 2010
Dietrich Schwarz
Voting season is upon us. Once again we are asked to approve new taxes in support of the community halls. Most of us have taken a position on the issue, in spite of many unanswered questions. The most fundamental question, surely, is: do we really need more taxes?

Residential property taxes have been levied as a fixed proportion of the market value for a long time. In recent history, from the early eighties until now, house prices in BC have increased by, roughly, a factor of five. Thus, there has been, on average, a five-fold increase in taxes per property. During the same period, the price of gas has a bit more than doubled, we pay about 2.5 times more for apples and new cars and employment wages have grown by similar factors. Therefore, the tax man takes about twice as much money per unit cost of returned service from property owners (and renters) than he did 25-30 years ago. However, we have not seen a doubling of services per unit. Add to that the recent building boom on Cortes Island, with correspondingly raised assessment values and tax bills, and you can be sure that we pay at least two to three times more tax now than planners determined to be necessary. Even if you consider only the housing market, we are overtaxed. Using a formula that relates house prices to rental costs the Economist has calculated that Canadian house prices are overvalued, on average, by 21.9%. The value is greater in BC and certainly on Cortes Island

Why, then, is it necessary to levy new taxes for a relatively small new service, the physical maintenance of our halls? Why can the excess taxes not simply be reassigned to new community needs? Our bureaucrats and politicians declare this to be impossible because the rules for tax administration require new taxes to be approved and collected for new purposes. Guess who made those rules. The problem does not appear to be that we do not pay enough tax! Understandably, a bureaucracy will be reluctant to release excess taxes, or even admit to their existence. Money, like heroin, is addictive: the more you get, the more you need. However, our politicians are elected as legislators: they should not only create new laws (and new taxes), but also to improve/update old laws (and re-use excess tax). How about representing us across government levels? Surely there will no objection in the community for a fair redistribution of taxes already paid. The new hall tax would have to be higher than repair bills and, once again, be stuck in a maze of rules. It would be a folly to vote more taxes into the hands of officials who use self-made rules to hide them.