A study by the Canadian Federation of Independent Business shows Prince George has one of the smallest gaps between residential and commercial property taxes in the province.
The study examined the difference in 2010 property tax rates between commercial and residential classes in 158 communities in the province.
Prince George ranked 134 with commercial properties paying only 2.05 times as much tax as residential properties of the same value.
Federation director of provincial affairs Shachi Kurl said the business organization is calling on B.C. communities to reduce the tax gap between residential and commercial properties to a two to one ratio at maximum.
"Prince George, in terms of the municipal tax gap, is actually doing pretty well," Kurl said. "Prince George is one of the communities that has kept very close to two to one."
Small business owners are particularly effected by high property taxes, she said. High property taxes can make a significant difference to small business' ability to hire staff, expand their business and contribute to the community, Kurl said.
"We have heard anecdotally from businesses that they are moving from one area to other areas because of the taxes," she said.
Out of the province's 30 largest cities, Prince George had the second-most favourable tax ratio after Penticton, which had commercial taxes 1.9 times higher than residential taxes.
Prince George's tax ratio increased to 2.13 times the residential rate in 2011.
"Even at 2.13 for 2011, that's not too bad. However it is trending in the wrong direction," Kurl said.
Initiatives Prince George president Tim McEwan said the report highlights the city's competitiveness as a place to do business.
"Prince George is in a very competitive position from a business perspective," McEwan said. "Our local government has taken the proactive approach to ensure a balance tax burden."
Tax levels are only one part of any company's decision to locate in a community, he added. However, Prince George also has affordable real estate and good availability of skilled labour which is appealing to businesses looking to locate their operations, he said.
The decision by Telus and Fortis B.C. to locate call centres in the city is an example of those factors coming together to attract businesses which could have located anywhere, he said.
Even with slight increase in the tax gap in 2011, "we're still in a very competitive position," McEwan said.
Prince George Chamber of Commerce president Guarav Parmar and Mayor Dan Rogers could not be reached for comment as of press time.
The District of North Saanich topped the list with commercial taxes 6.05 times higher than residential property taxes.
Across B.C., commercial property owners paid an average of 2.79 times as much as residential property owners.
The Canadian Federation of Business study only looked at commercial tax rates, not rates for other business-related classes such as light industry, utility or heavy industry.
Commercial to residential tax ratio 2010
Prince George: 2.05
Kamloops: 3.12
Kelowna: 2.38
Naniamo: 2.68
Coquitlam: 4.69
Vancouver: 4.55
B.C. average: 2.79
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