Cruel to be kind

The City of Iqaluit made only one mistake in its handling of property owners who can’t or won’t pay their municipal taxes.

They waited far too long to take action against them.

Apart from that, Iqaluit’s municipal government is doing the right thing. To do otherwise would perpetuate an injustice against the hundreds of homeowners and businesses who have always paid their property taxes in full, and on time.

Taxation is the means by which governments collect the money they need to pay for things that serve the common good. In Iqaluit, it’s property taxes that help pay for road maintenance, firefighting, bylaw enforcement, municipal planning, public transit, recreation, and other municipal services that we all use.

Those who have decided not to pay their fair share of tax have, in effect, decided on their own that they deserve to get those services for free. That means those who do pay must carry an unfair proportion of the cost.

Whether Iqaluit’s municipal council spends its tax revenue wisely is a subject of legitimate debate. So is the issue of whether tax rates are too high or too low.

But one issue is beyond debate. Everyone must pay.

This is not a new issue. It’s been a subject of public debate for years. Iqaluit’s municipal council has wrestled with it since at least 1997, when the territorial legislature gave tax-based municipalities the power to seize properties and sell them to recover unpaid tax revenues.

Instead of cracking down hard, the municipality took a soft approach, a combination of gentle persuasion and public shaming. The municipal council published its list of tax deadbeats every year to humiliate them into paying up. For years, the municipality warned that property seizures and tax auctions would follow. For many tax delinquents, it worked.

But a small group of hard-core refuseniks never got the message. Some appear to have never paid a cent of property tax for the entire time they’ve owned their properties, and now owe astronomical amounts.

Consider the case of Iqaluit’s reigning tax deadbeat champion, Jonah Kelly, who owes nearly $162,000. That’s probably more than the re-sale value of the house. Because of the 18 per cent annual interest rate that the city applies to unpaid accounts, that figure will jump dramatically from one year to the next.

Another man, Jeetaloo Kakee, owes nearly $132,000. Akeeshoo and Alicie Joamie owe more than $46,000. Others owe amounts ranging from $12,000 up to $30,000.

In such cases, where people have been unwilling to pay for years, seizing the property and selling it to pay the tax bill is not an injustice. It’s an act of mercy. Sometimes you have to be cruel to be kind. The city should have taken action years ago to stop the bleeding.

Nunavut Tunngavik Inc. has now waded into the debate with all the mushy-headed ignorance it can muster. This week, the organization asked Iqaluit City Council to delay its Sept. 15 tax auction until they can discuss the issue with city councillors.

The city should ignore this request. The process has been delayed already for years. Another delay would cause even more financial damage to the tax deadbeats that NTI is claiming to protect, since it would cause even more interest to be piled on top of their already staggering tax bills.

To be fair, NTI is likely acting upon the honest belief that the City of Iqaluit may by creating more homeless people by evicting them from their homes and turfing them onto the street. However, this belief is founded upon an ignorance of the facts and an ignorance of the context.

This is not a land claim issue in any sense. It’s the structures built on top of the land, not the land itself, that are taxed. In any case, the Nunavut land claim agreement gives municipalities fee simple title to nearly all lands within municipal boundaries. Except for a few Inuit-owned lots controlled by QIA, and a strip along the beach, there is no more Inuit-owned land in Iqaluit. This is a municipal government issue and NTI should butt out.

Besides, for more than a decade the Nunavut Housing Corp. has been routinely evicting deadbeat tenants from housing units all over Nunavut, including people who owed tens of thousands of dollars in back rent and damage costs.

City officials have already said they are willing to be flexible with those who owe large delinquent tax bills. They say they are willing to accept small installment payments spread over lengthy periods of time. And yet a small core of delinquents refuse to make even the smallest gesture toward paying their bills.

Since last week, about eight of the 17 tax deadbeats whose properties were slated for auction have either paid their arrears in full, or arranged payment plans with the city. That, more than anything, shows that the city is doing the right thing. JB