Tbnewswatch Local News
Wednesday July 1 2015
5:08 PM EDT
2014-02-03 at 16:52

Dryden 134 per cent industrial tax hike met with negative reaction

By tbnewswatch.com

A move by the City of Dryden to resolve its growing revenue problems has been met with some negative reaction.

City officials voted Friday to increase their large industrial tax rate by 134 per cent. The move  impacts only the Domtar Mill, which lost 70 per cent of its value in a property assessment last year.

Domtar paid Dryden just $853,000 in taxes in 2013. Under the new tax rate for 2014, the city will collect more than it did before the reassessment -- nearly $2 million.

Domtar's Regional Public Affairs Manager Bonny Skene calls the tax levy "a serious competitive disadvantage," pointing out the mill's value is based on having permanently closed two-thirds of its operations and having eliminated 600 jobs.

Although Domtar typically meets quarterly with every community in which it does business, no meetings have taken place between the company and Dryden since last summer.

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smartguy83 says:

5. (1) Subject to any regulation that may be made under subsection (3), the amount of tax that is payable under section 2 on land for a taxation year is calculated using the formula,

A × B

in which,

“A” is the prescribed tax rate for the taxation year for the property class in which the land is classified, and

“B” is the assessed value of the land for the taxation year according to the last revised assessment roll for the year.
2/4/2014 4:10:14 PM
Eastender says:
The question that hasn't been resolved is " is this mill making a profit, and by paying 2 million in taxes are they still making a profit?" Can they afford to pay the assessed taxes and still turn a profit? Yes or no will suffice. This is a corporation and their sole purpose for their existence is to grab as much profit as possible. So tax them according to their sales and not property assrssment.
2/4/2014 10:47:50 AM
S Duncan says:
I believe the sole purposes of taxes is that they are paid for services rendered.

They should not be paid based on how much you can squeeze out of them before they fold up their tents and go away.

If the house next door to you is identical to yours, but the people that live there work 2 jobs each and you only work one, should their property taxes be more than yours?

just because they earn more than you do?

You might be confusing property taxes with income taxes, which is exactly what municipal governments are trying to do. They are no longer interested in just being paid for the services they provide, no, they are dead set on extorting as much as they can for you, so they can use it for their personal agendas.

Thunder Bay better watch out because the same will happen here. They are going to tax private people right out of the city, and business will leave too. Its already happening if you look around.
2/4/2014 2:35:30 PM
Eastender says:
Property tax is not structured to treat everyone equally. It is based on property values. It is assummed that if your property is worth 500,000, then you have the ability to pay a higher tax, while your neighbour whose property is worth half that of yours gets to pay much less. However, your services are exactly the same. Here is the dilemma, the person who owns the 250,000 home, pays half of what the 500,000 home pays, but the guy who lives in the lower priced home makes 150,000 bucks annually, while the guy who lives in the half million dollar home, is on a pension of 75,000. The assumption that you are able to pay more simply because your home is worth more is false. Property tax has always been based on ability to pay, ecxept that the value of your house does not always reflect that reality. Therefore it is time to change the system to correspond to its intended purpose, which is to have individuals pay according to their ability, not their property values.
2/4/2014 8:29:58 PM
S Duncan says:
I disagree that property tax should be based on your ability to pay.

That's where income tax comes into play.

Property tax is not about bleeding as much as you can without killing the host, its about providing services.

It should also be based on the number of people living within a home because more people consume more services.

People should never be paying taxes based on their ability to pay.

In all honesty the more municipal government tries to control, the more they take from us. Sooner than later people are becoming fed up with paying for services they do not require.

That's why municipal governments need to be pulled back and focus on the base/core services they were only ever intended to deal with. Sewers, streets, lights, light zoning issues and such. They should not be empire building, real estate speculating, entertainers, property developers, social engineers, etc..

One thing for sure, if a city caters to the poor, that's what it will be full of.
2/5/2014 10:10:45 AM
smartguy83 says:
Several issues with this. First I am unaware of any other municipality which this structure exists in so Dryden would be the first.

Second profit can be manipulated thus making audits F/S's still unreliable.

Third, Dryden needs to know it's tax revenue to set it's budget. Tax revenue basically is a "plug" to make the Municipality reach it's budgeted deficit/break-even point/surplus.

I would really like to know more on my first point. I wonder if Municipalities are even allowed to deviate from the current structure by some sort of regulation.
2/4/2014 4:06:53 PM
smartguy83 says:
Domtar is learning that your tax assessment is not what matters. It's the rates that do. This is reality now. Industry will not survive in smaller communities under the current property tax structure. Too dependant on one tax payer will continue to lead to this same result in other communities.
2/3/2014 9:50:53 PM
tsb says:
Domtar is clearly on shaky financial ground. The company won't be around much longer so why not get as much out of it as you can?
2/3/2014 7:29:00 PM
Marak says:
So Dryden's incompetence at managing their finances will drive the last major employer out of town because of massive tax increases? Gotta love this mentality! Watch, Thunder Bay is next!!!
2/3/2014 5:56:26 PM
ring of fire dude says:
Not to worry , the Event Center and Art Gallery will bring in bus-loads of revenue to the City .
2/3/2014 11:29:08 PM
windigo says:
Easy way to solve their money woes, just take it from the pulp mill. Listen to the crying if Domtar closes the mill. Times have changed, these mills are no longer big cash cows capable of supporting the towns.
2/3/2014 5:19:47 PM
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