The City of Guelph is looking to scrap its Vacant Unit Tax Rebate Program.
The move, recommended to be in place for Jan. 1, would save city taxpayers approximately $470,000 a year, says a city report.
Other municipalities have already scrapped the program, which was introduced by the province in 1998 and provides a tax rebate to eligible property owners who have vacancies in commercial and industrial buildings.
Recent changes to provincial legislation allows municipalities to change or eliminate the rebate program.
The staff recommendation still has to be approved by City Council.
The program offers a rebate on taxes paid by qualified applicants of 30 per cent for commercial space and 35 per cent for industrial space.
The city says that since 2010 it has processed a total of 891 rebate applications and refunded roughly $6.3 million. Of that the city portion was $3.5 million and the education portion $2.7 million.
One of the main arguments in favour of doing away with the program is that it “deters property owners from filling their vacancies,” the report says.
Eliminating the tax rebate will help motivate property owners to fill their vacant spaces, it adds.
The staff report notes that 37 city properties have been vacant for more than three years and already receive a reduction in their property assessment. Combined with the Vacant Unit Tax Rebate Program, those property owners could be “double dipping.”
The rebate program has been funded through property taxes, two thirds of it by residential taxes.
It also costs the city to process the applications, having spent 275 hours on processing 133 applications in 2016 alone.
