Tax-fighting paper company pays bills

Catalyst Paper has decided to pay its tax bills in three B.C. municipalities but is holding back on paying the levy to a fourth city because of a continuing court battle.

The Richmond-based paper producer has spent the past year in court, fighting what it called an unsustainable and unfair property tax rate in most of the towns and cities where the company has mills.

Catalyst, which sells about $1 billion worth of products a year, lost the lawsuits it filed against the municipalities of Powell River, Campbell River, Port Alberni and North Cowichan.

The company then sought leave to appeal the judgment in its fight with the city of North Cowichan to the Supreme Court of Canada, and it was not clear whether any of the tax bills would be paid while the legal proceedings continued.

The tax bills ranged from $3 million in Powell River to a high of $6.5 million in North Cowichan.

Three bills paid in full 

On Wednesday, the day before the July 1 tax deadline, Catalyst paid its taxes in full in three of the municipalities. 

It said it has opted to pay only its $1.5 district government levy in North Cowichan, and not the $5 million city bill, until the legal outcome in that dispute is determined.

In a release Wednesday, the head of the company said Catalyst is not alone in its campaign to lower municipal taxes on businesses.

"Since Catalyst launched legal actions in 2009, a growing number of organizations have championed the need for a more sensible B.C. municipal tax structure," said Kevin J. Clarke, president and chief executive officer. "Competitive taxation keeps companies and communities viable in the post-recession economy. This helps preserve existing jobs and it creates the right conditions for new ones."

The $5.2-million payment to Port Alberni was a relief, Mayor Ken McCrae said.

But McCrae also said he agrees with Catalyst's view that its tax burden is too high and not sustainable.

McCrae said he looks forward to recommendations due this fall from a B.C. government committee examining municipal taxes. He's also appealed to provincial cabinet ministers to give municipalities time to adjust to any change in the tax system.

"To the forests minister, to the finance minister, to the minister of municipal affairs … anyone who would care to listen, they know our position," McCrae said. "What we'd like them to do is make the changes so it doesn't all happen at once."

McCrae said Port Alberni has already had to cut its overall budget by 10 per cent and laid off dozens of employees. More cuts may be in store, he said.

The Supreme Court of Canada has not yet responded to Catalyst's appeal request.