The Chinese government has just been ordered to pay $3.6 million to the City of Montreal, because it never paid municipal taxes for the former Shriners hospital, acquired four years ago in order to transform it into a consulate .
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Beijing purchased the property located in a protected area of Mount Royal Park in 2019 for $17.5 million in order to move its diplomatic premises there. They have been located since 2011 in a rented building on Sainte-Catherine Street West, in downtown Montreal.
Significant work had to be carried out on the property before the consulate could be moved there. However, no permit request has yet been submitted to the City of Montreal, according to the Urban Planning and Mobility Department of the Ville-Marie borough.
At the time of the purchase, the Chinese consulate in Montreal indicated to Newspaper that the new consulate would not be ready for “several years” given the work to be carried out.
The Shriners Hospital, specializing in orthopedic care for children, closed its doors in 2015 to move to the site of the McGill University Health Center, and was then put up for sale in 2017.
No exemption
States normally benefit from immunity exempting them from taxes on their properties abroad. However, this immunity does not apply in cases where the buildings are not attached to state purposes, as is the case here.
When it gave its approval to the project in July 2019, the Canadian Ministry of Foreign Affairs warned Beijing that a new request for renovation work had to be submitted before the complex could be used as a consulate and that by then , taxes will be payable.
However, the Chinese government has never paid the approximately $900,000 claimed annually by the City between 2020 and 2023. The building is currently valued at $32.7 million according to the Montreal property assessment roll, or nearly two times the amount paid by Beijing.
No Chinese official appeared at the Court of Quebec to contest Montreal’s request.
Judge Luc Huppé therefore ordered Beijing to pay the entire amount to the City, in addition to the interest and rates prescribed by municipal regulations since the due date.
The Chinese consulate in Montreal indicated, by email, that it had “repeatedly presented the Chinese position on the question of taxes for the building concerned to the City of Montreal, and is in the process of discussing this issue with the City. “.