I’m all for taxing the profits of businesses, but the so-called “Double Tenant Tax” just doesn’t make sense. This isn’t a tax on profit, but rather a tax on owning investment properties. Since most landlords operate their businesses as profit-driven enterprises, they simply raise rents until they hit the acceptable level of profit as determined by the market. This is not a conspiracy; it’s economics.
The central problem is that regardless of how much annual tax a landlord pays on their property, that cost will be wrapped into the cost of rent anyway. The end effect is that renters are indirectly paying enormous taxes. Typically, people who rent are in a weaker financial situation than homeowners, so it is simply not fair that they pay $62 million extra each year, regardless of how much the province needs that money for healthcare and education.
The flip side of the issue is that simply repealing the tax won’t necessarily fix anything. Landlords could very well pocket the difference and pass none of the savings on to the tenants. What’s really needed is a sweeping reform of rental legislation in New Brunswick. In exchange for repealing the double tax, perhaps rent control laws could be passed. At the very least, the current system is undeniably broken and in need of an effective and sustainable fix.
