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Shipbuilder prompts Esquimalt to consider tax breaks
To encourage growth and bolster municipal coffers, a tax holiday may be considered for Esquimalt's major shipbuilder.
Seaspan Marine Corporation, which owns Victoria Shipyards in Esquimalt, recently asked the township for property tax relief on new facilities that would need to be built at the Esquimalt graving dock.
Future buildings would allow it to meet the needs of a multibillion-dollar federal shipbuilding contract, said John Shaw, Seaspan vice-president of program management, in an email.
The federal government is awarding two lucrative contracts in September.
Seaspan's request comes at an ideal time.
“We were going to do that anyways,” said Karen Blakely, Esquimalt's director of financial services.
“If you look at our objectives in our financial plan, one ... is to stimulate and reinforce development initiatives ...,” she said.
Implementing a tax relief strategy would be ground-breaking for Esquimalt, which, similar to other municipalities, grants permissive tax exemptions to non profits, such as churches.
“It may be that we can do (a strategy) for Seaspan, which was the catalyst of getting us to go that next step, or it may be more of a general policy,” said Esquimalt Mayor Barb Desjardins, adding that a tax relief strategy could be developed for one or more tax classes.
“It would be a win for businesses, and they sure need it,” Desjardins said. “Throughout B.C., businesses get taxed more. In any way we can, we need to support or increase the percentage of businesses because they do pay more.”
Esquimalt is looking to the District of North Vancouver as an example, since it granted a tax rate reduction to Seaspan-owned Vancouver Shipyards on new and expanded properties for a set number of years.
The break helps offset the corporation’s capital costs, and the municipality benefits from job creation and economic stimulation.
“The municipality wins because they get something immediately, and then they get more as time goes on,” Blakely said.
A staff report outlining different tax strategies will be presented to Esquimalt council this fall during deliberations for the 2012 budget.