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Legislation allows machinery tax breaks

machinery tax
Al Kemmere, RMA president and Mountain View County councillor.

MOUNTAIN VIEW COUNTY - New provincial amending legislation (Bill 29) introduced recently would allow municipalities to give commercial property tax exemptions to business owners for machinery and equipment.

Legislation passed earlier this year (Bill 7) allowed municipalities to offer business tax property exemptions of up to 15 years. Bill 29 amends that legislation to include machinery and equipment.

Al Kemmere is a Mountain View County councillor and the president of the 69-member Rural Municipalities of Alberta Association (RMA).

“We have the concern that once you get municipalities competing against each other, they are then driving to the lowest common denominator on taxation rather than taxing at the appropriate level,” said Kemmere.

“Right now we are legislated to come forward with inter-municipal collaborative frameworks, where we have to work together as municipalities. To have us competing against each other at that aggressive level I don’t think rings in the tone of collaboration or cooperation. That would be my concern as much as anything.”

If passed, Bill 29 would allow municipalities to offer tax exemptions for up to 15 years on machinery and equipment.

The legislation states, in part, that, “a council may, by bylaw, for the purpose of encouraging the development or revitalization of properties in an assessment class for the general benefit of the municipality provide for full or partial exemptions from taxation or deferrals.

“If after reviewing an application (from a company) the municipality determines that non-residential property meets the requirements for a full or partial exemption or for a deferral, the municipality may grant the exemption of deferral.”

Property defined as machinery and equipment includes oil and gas pipelines.

“Our government passed Bill 7 this past summer, as part of our ongoing effort to revitalize municipalities across Alberta,” Kaycee Madu, minister of municipal affairs, said in a press release.

“Business and industry stakeholders have been clear that while this was a good move, expanding these tax incentives to include machinery and equipment would be even better. We have listened and introduced this legislation to spur more investment in our communities.”

In the same release, Ken Kobly, president and CEO of the Alberta Chambers of Commerce, added, “Flexibility to offer machinery and equipment tax incentives will help communities attract investment and support local job creation. Municipalities are key provincial partners in fostering a competitive business environment.”