COTAPSA worked closely with City to do the right thing on behalf of our Members affected by the Canada Revenue Agency's assessment of parking
As you know, COTAPSA has been working diligently and consulting with the City regarding this issue since the matter first arose. As a result, City Council approved a program to fund the cost of any retroactive tax and interest owing for years 2006 to 2010 for those employees at its May 12, 2010, meeting. In addition, the City will work with staff to object to the reassessment.
The decision from CRA to assess the tax has been very upsetting to those employees affected. Once again, non union employee’s income was being depleted through no fault of theirs. COTAPSA was hoping that Council would approve this initiative and would like to applaud the City for doing the right thing.
Once again, the City will work with staff to object to the reassessment and will also fund the tax owing and interest payable for the 2006 to 2010 taxation years.
This payment on behalf of employees is valued at $5.950 million and will be funded from the Benefits Reserve Fund. As a condition of this funding, all employees impacted by this CRA reassessment must agree to file Notices of Objection with the CRA by June 30, 2010 (to be coordinated by the City) and cooperate in proceeding with the appeals and attend any required hearings. They must also provide the City with a copy of their Notices of Reassessment and the signed Notices of Objections.
If objections are successful, the employee will reimburse the City with all funds returning to the Benefits Reserve Fund. If objections are unsuccessful, no further action will be required by employees.
The potential reassessments also impact employees’ retirement program, OMERS, as this taxable benefit would change their contributory earnings. As a result, both the City and the employees will have to make additional contributions. City employees will have to repay contributions with an estimated value of approximately $1.4 million. The cost to an individual employee will vary depending on the amount of the reassessment, ranging from about $70 per year for East York Civic Centre to $280 per year for Metro Hall.
As an employer, the cost of retroactive OMERS contributions is approximately $2.020 million. The total estimated cost of the employee program is $8.0 million.
