Winnipeg Property Tax Burden Lighter, But Comparatively Heavy

Frontier Centre, Manitoba, Uncategorized, Winnipeg (historic)

[WINNIPEG] Despite a decided trend towards reductions, Winnipeg’s property taxes are still higher than most other Canadian cities, according to a new comparison released today by the Frontier Centre for Public Policy.

“Between 2000 and 2001, the city did an impressive job of trimming property taxes,” said the study’s author and Frontier President Peter Holle. “But other cities were reducing their taxes as well, so Winnipeg’s relative ranking remained unchanged.”

Holle noted that the portion of property taxes assessed to support public schools fell only slightly, and that fact weakened the outcome. “It looks like school boards are dropping the ball,” Holle commented. “If they had been as fiscally rigorous as the city, Winnipeg’s property tax burden would have fallen much more quickly.”

The Frontier study, an annual assessment, uses different survey data to compare the relative property tax burden across Canadian cities.

The calculation of effective tax rates – a figure skewed by Winnipeg’s lower property values – indicates that the city’s tax burden remains among the highest in the country. When utility charges are included in the mix, or when benchmarked against our relatively lower income levels, Winnipeg comes third last.

Highlights:

  • A standard two-story house paid 2.49% of market value in property taxes in 2001, the highest in Canada. Other prairie cities paid substantially less: Calgary (.91%), Saskatoon (1.54%) and Regina (1.98%)
  • When property taxes and utility charges are combined, Winnipeg has the sixth highest total charges on a standard house in Canada of 18 cities compared.
  • Property taxes relative to income for Winnipeg were 4.3 percent, the sixth highest in the country. The lowest taxes relative to income were in Calgary at 2.3 percent of income.
  • Winnipeg has the highest water utility user fees in Canada.
  • Holle suggested a number of approaches that could reduce property taxes further, which include:

  • Removal of the school portion of property taxes, paid for partially by the phase out of the provincial property tax rebate, with the Province assuming the whole cost of a basic education,
  • Broad policy reforms embedded in the City of Winnipeg Act to require the use of more transparent, cutting edge delivery models, and
  • On the revenue side, moving to revenues sources traditionally used by other Canadian cities, more user fees wherever possible, and introducing a hotel room tax to pay for services enjoyed by visitors.
  • “A phase out of school property taxes plus a broadening of the revenue base and structural reforms at city hall to increase efficiency, could reduce Winnipeg’s property taxes up to 60%,” Holle said. A reduction of this magnitude would drop the city property taxes to the lowest in Canada and would dramatically boost property values.

    The new paper, entitled “2002 Comparison of Effective Residential Property Tax Levels in Major Canadian Cities” can be downloaded from www.fcpp.org. The Frontier Centre is Winnipeg’s only independent public policy think tank. It was set up in 1997 and has a staff of 7 and a board of research advisors that explores positive changes within public institutions that support economic growth and opportunity.

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    For further information, please contact:

    Peter Holle, President of the FCPP, (204) 957-1567

    Dennis Owens, Senior Policy Analyst (204) 957-1567

    Daniel Klymchuk, Policy Analyst (204) 957-1567