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CFIB Ranks Best & Worst Property Tax Gaps in Saskatchewan Cities

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The Canadian Federation of Independent Business (CFIB) released its annual comparison of property tax gaps in Saskatchewan municipalities on December 6, 2017. According to CFIB, the overall results for the year 2016 were mixed across the province and on average, commercial property owners paid 2.21 times what residential owners paid in municipal property taxes.

With this past year being a revaluation year, numerous businesses throughout Martensville saw a large spike in their taxes raising concern among the business community. Members of the Martensville Chamber of Commerce met with officials in City Hall to try to work together to better accommodate local businesses through this additional financial burden. Although the City had already reduced the uniform mill rate, the commercial mill rate factor and increased the commercial base tax rate to $915 for 2017, the reassessed rates for commercial properties led to a wide range of increases. “As a result of the revaluation, commercial property values for some businesses increased on average, by almost 90%, and therefore property tax also increased substantially for some properties, even with the mill rate reduction and the new property tax structure the City put in place,” Dillon Shewchuk, Community and Economic Development Manager for the City of Martensville, said in a November press release. This past November, the City of Martensville announced that they would be instilling a new Commercial Business and Property Abatement Program to better accommodate businesses that appeal their 2017 assessment in 2018, noting that businesses that put through appeals this year, have seen high success rates. Businesses that successfully appeal their assessment in 2017 will have the corresponding amount of municipal taxes paid in 2017 retroactively abated in the form of credit to their property taxes.

“While some cities are doing a better job than others in making municipal property taxes fairer for small businesses, there is still more work to be done,” said Jennifer Henshaw, CFIB’s Senior Policy Analyst for Saskatchewan and co-author of the report. “This report should be required reading for all municipal leaders as they determine their 2018 operating budgets in the coming weeks.”

Within the report released by CFIB, it is noted that a provincial tax gap of 2.21 means that Saskatchewan commercial property owners paid, on average, $2.21 for every dollar in municipal property tax paid by homeowners. This information was based on the examination of municipal and total property tax gaps within 75 municipalities and 31 rural municipalities with populations of 1,000 or larger. The tax gap measures the ratio of commercial and residential property tax bills for properties assessed at a value of $200,000.

Locally, the report noted that Martensville had the least improved municipal property tax gap, widening its gap by 6.62 per cent. Warman saw a municipal property tax gap of 1.39, giving them the lowest municipal property tax gap among Saskatchewan cities, with Prince Albert seeing the highest at 3.86. Saskatoon had the lowest commercial municipal property tax bill of $1,847, with Prince Albert once again coming in as the highest in the province with a commercial property tax bill of $6,546.

When provincial education property taxes are factored in, commercial property owners in Saskatchewan’s cities paid, on average, 2.38 times what residential owners paid in property taxes. “Entrepreneurs are fed up with getting the short end of the property tax stick and worry many municipalities will continue to hike property taxes to fund unsustainable spending,” concluded Henshaw. “The majority of municipalities need to work harder to further contain costs and commit to a plan to make their property tax system more fair for entrepreneurs.”

For more information, visit www.cfib-fcei.ca.

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