One reporter’s attempts to clear the air on proposed Vancouver tax
In a small but relatively random survey of Vancouver-based businesses, it appears that many businesses prefer not to publicly comment on the proposed citywide business and occupation (B&O) tax.
In this survey, more than 35 businesses were contacted, and asked for their opinion – for or against – the proposed tax. Out of these 35, only eleven responded at all; of those, five said they weren’t at liberty to make a statement one way or the other or were required to say they were in favor of it; two hadn’t heard about the proposal at all; two were willing to make a public but anonymous comment and two took a solid stand against the tax.
For an issue that will affect virtually every business within the Vancouver city limits, this lack of response was somewhat surprising. What is making people hold their tongues? Primarily, the answer appears to be fear of either alienating the City Council, or alienating customers.
"I have customers on both sides of the issue, so I’m staying out of it," said one banking executive. He admitted being surprised that some of his customers strongly supported the tax proposal, but wasn’t willing to annoy them by discussing his personal opinion of the tax.
Other businesses reported that since the city of Vancouver was a big customer of theirs, or owned a controlling interest in the business, they weren’t at liberty to say anything against the tax. That may be just good business sense on one hand, but on the other it smacks of Tammany Hall.
One business manager said he was in favor of the tax, personally.
"It is a good idea, since voters won’t vote for it," he said. But he didn’t want to be identified because general managers aren’t allowed to comment on such issues.
One business owner who spoke up is Bruce Davidson, president of Davidson Insurance.
Davidson stated that the City should be run like a business, and live within its means. If additional revenue is needed, then he said they should use the existing tax structure by convincing residents that revenue was needed, then have them vote on a tax. He objected strenuously to the city of Vancouver focusing on businesses as opposed to all the residents of the city.
"They shouldn’t bypass the voters," said Davidson.
Davidson also objected to the proposed tax because it wouldn’t differentiate between commodity-based businesses and commission-based businesses like his. He pointed out that although commodity-based businesses may not want to raise prices to offset the cost of a new tax, at least they could raise prices if necessary. In contrast, he said the insurance industry is regulated, and premiums are set by the insurance companies themselves (not brokers like himself), and filed with Washington State regulators.
Other businesses that were against the tax brought up the economy. Colleen Seger, who works at Accent on Antiques and Collectibles, called the proposed tax "just one more nail in the coffin" for small, family-run businesses. She felt that the tax would be more of a burden on such businesses, which typically have a smaller margin of profit, than on larger corporations.
A downtown restaurant owner agreed with Seger.
"The economy is not good right now," said this person. "It is an extra burden." This person – who wished to remain anonymous – also objected to the proposal of paying the tax on gross receipts, stating that paying it on net earnings would be more equitable
Outside the city limits of Vancouver, and mostly outside the fray of the discussion, folks were more likely to speak up. Casey Collins, past president of the Hazel Dell Business Association, stated that it seemed to him the city of Vancouver was sending a "mixed message."
"Two years ago, their motto was ‘We’re open for business,’" said Collins. "Now they’re raising taxes."
Collins stated that the seemingly "never ending" tendency of Vancouver to raise taxes was one of the reasons why Hazel Dell business owners prefer to remain unincorporated. He also pointed out that Hazel Dell businesses wouldn’t be completely unaffected by the proposed tax, because they would have to pay the tax on any part of their business that was conducted within the city limits of Vancouver.
"It will raise the cost of doing business in Vancouver," said Collins.
Ron Hart, who is heavily involved in Rotary and who served on the Vancouver City Council for 12 years, didn’t say whether he was for or against the proposed tax. But he did say that businesses who claimed ignorance of the issue weren’t holding up their end of being good citizens. He decried the head-in-the-sand approach to running a business (such as one restaurant owner saying he had been "too busy cooking" to hear about the proposed tax). To be a good citizen, said Hart, you need to work at informing yourself.
