When the Canadian Federation of Independent Business (CFIB) released its eighth annual report on the comparison of property tax gaps between municipalities, Kamsack came out on the bottom, while Canora was a little better than average.
The tax gap is defined as the amount more that commercial property owners paid as compared to the property taxes paid by residential property owners.
The provincial average shows commercial property owners paying 2.28 times (defined as the tax gap) the municipal property taxes of residential property owners. Canora was in fourth place (among municipalities with at least a population of 1,000) in the region with a tax gap of 2.18.
Langenburg was deemed the best with a tax gap of 1.20, followed by Kelvington, 1.68; and Preeceville, 1.90. In the bottom five were: Esterhazy, 2.50; Wadena, 2.89; Wynyard, 3.10; Kamsack, 4.47; and Foam Lake, 5.14.
The figures were based on property taxes per $200,000 assessment. In Canora, residential rates are $1,964 and commercial is $4,290. While Langenburg has the best tax gap, Kelvington had the lowest commercial property taxes ($1,890 compared to residential at $1,128).
Kamsack had a lower residential rate ($1,600) but its commercial rate is $7,150. Preeceville’s residential rate is $1,868 while its commercial rate is $3,546.
CFIB’s eighth annual research report, Wanted: Property Tax Fairness in Saskatchewan examines municipal and total property tax gaps for 69 municipalities and 32 rural municipalities (RMs) with a population of 1,000 or more.
“The good news is some municipalities do a better job than others in making municipal property taxes more fair for small businesses,” said Marilyn Braun-Pollon, CFIB’s vice-president of Prairie and Agri-business. “However, the bad news is many Saskatchewan business owners continue to pay more than their fair share and get the short-end of the property tax stick.”
In fact, Saskatchewan commercial property owners paid from $1.14 to $5.14 for every dollar in municipal property taxes paid by homeowners. In east-central Saskatchewan, it ranged from $1.20 to $5.14, with an average of $2.78.
In the region, Foam Lake was said to have the most unfair municipal tax system in the province with a municipal property tax gap of 5.14 and the highest commercial municipal property tax bill of $11,700.
When provincial education property taxes are factored in commercial property owners in east-central Saskatchewan are paying on average 2.68 times the property taxes of residential property owners, states Braun-Pollon.
This report should be required reading for all municipal leaders as they determine their 2016 operating budgets in the coming weeks, she said.
“We worry many municipalities may continue to hike property taxes to fund unsustainable spending,” added Braun-Pollon.
“While we recognize the many challenges they face, the fact is the municipalities analyzed in the east-central received a 128 per cent increase in municipal revenue sharing from 2007-2008 to 2015-16,” said Braun-Pollon. “We believe municipalities need to further contain costs and commit to addressing the inequities in their municipal property tax system.”
The CFIB report outlines a series of recommendations for provincial and municipal governments to ensure the property tax system becomes more balanced over time.
