St. John's business tax hike: 'We're stuck with it', says Dennis O'Keefe

As a storm continues over taxes in St. John's, the mayor is defending the city's budget outside the council chambers.

• St. John's business leaders preparing to fight city budget

The budget hasbeen criticized by arts groups, homeownersand business people since it was released in December, althoughDennis O'Keefehas largely stayedquiet until this week, when he started doing interviews.

We realize that the property tax is unfairbut we're stuck with it.- Dennis O'Keefe

"When you're facing budget reductions it impacts oneverybody," said O'Keefe, who hadwanted to wait to speak until city officialsmetwith the Board of Trade.

The business organization hascondemned the city'sfiscal plan,saying the tax increase would threaten the viability of some businesses.

O'Keefedescribes the budget as being "for the future financial health of the city."

"The best one can do isensure that it's a broad-based impact so that one particular group is not in the position of being impacted too adversely while another is not impacted at all," said O'Keefe.

Unfair Increase

Many downtown business owners say thebudget has increasedtheir taxes to obscene amounts.

MelanieCaines, who runs Nova Yoga on Long's Hill in downtown St. John's, said her taxes have increased by $2,000, which describes as anexorbitant hike for a tiny business with limited revenues.

It feels like they're punching you in the gut and spitting you in the face.- Melanie Caines

"It's completely ridiculous, it's unfair... you feel like you're being punished," Caines told the St. John's Morning Show.

"It feels like they're punching you in the gut and spitting you in the face."

Caines said she's had to cut back on staff hours, but doesn't want to increase clientfeesto make up for her increased costs.

While she says her business does fairly well and she's thankful to be able to do what she does, the city needsto understand that this affects everyone not just the business.

"Maybe prices are going to increase, maybe yourfavourite local business is going to have to shut down because they can't survive this," Cainessaid.

"I don't pretend to know how to runa city but in my mind you don't give yourself a raise, hike taxes andcut services ... it's rude, it's dirty, and it's disrespectful to the people who voted you in and had faith in you."

Bottom line

While O'Keefesaid heunderstandsthat businesses have concerns, he said theymay not see any tax relief.

"We realize that the property tax is unfair, that the property tax isaggressive, that the property taxis inequitable, but we're stuck with it," saidO'Keefe.

Hesaidthe money hadto come from somewhere in order to maintain services, and it's not council's fault most revenue comes from property taxes.

If anyone hasa problem with their property assessment, O'Keefe said there's aprocess put in place by the province to challenge it or find out how the amount was assessed, and people should use it.

He added that the city has received around1,300 appeals, which is onlyup slightly from around 1000 during the last round of assessments.

Thecity plans to have discussions with businesses, and if there is anything that can be done, O'Keefe said they'll keep an open mind but businesses also have to understanding of city issues.

"Again, I have to say that we have a budget and the bottom line of the budget will be maintained ... As reasonable people we should be able to work through that process."