On-Campus Commercial Businesses Now Subject to Property Tax


In an earlier Campus Counsel article, we reported on the First Reading in the Legislature of the Minister of Finance’s Bill 2, the Budget Measures Implementation Act, 2011. The Act has now been passed. Parts of that Act were brought into force on Royal Assent, which was June 2, 2011, including the provisions that amend section 54 of the University Act to add the following wording (in bold):

54(1) Unless otherwise provided in an Act, the property vested in a university and held or used by or on behalf of the university for university purposes is exempt from taxation under the Community Charter, the Local Government Act, the School Act, the Vancouver Charter and the Taxation (Rural Area) Act.

The intention is apparently to tax commercial enterprises operating on their own behalf on university lands. The University Act was also amended to allow the Government to make regulations specifying that subsections 54(1) – (3) do not apply to certain property, but to date no such regulations have been passed. It should also be kept in mind that the Budget Measures Implementation Act, 2011 includes transitional provisions, notably sections 31, 32 and 33 of the Act. These provisions provide that property exempt under the University Act as it read on December 31, 2009, continues to be exempt for purposes of the 2010 taxation year until the earlier of December 31, 2015 or December 31 of the taxation year in which the holder or occupier of the property changes. However, with respect to the 2011 taxation year, the amendments to section 54 are retroactive.

It will be interesting to see whether a further challenge to section 54 is launched. Anyone requiring a complete copy of the transition provisions is welcome to contact the authors, Larry Munn or Richard Weiland.