Saskatoon property owners face tax increase, commercial owners’ shoulder greatest burden

The City of Saskatoon has tabled their epic discussion on a two-year budget for 2020/2021.

While the preliminary budget released this summer projected a 3.97 per cent property tax increase overall, we can all breathe a sigh of relief because it will only be 3.7 per cent.

Wait, what the heck?! That’s still a lot!

This is not good news for anyone, especially commercial property owners who already carry a greater tax load than their residential counterparts.

Commercial to residential tax ratios

As Barry Stuart reported last Fall, across Canada commercial property owners carry more of the tax bill than homeowners.

The fairness of this system is questionable; while we all want to pay lower taxes on our homes, its not sustainable for businesses to pick up an unequitable share.

Altus Group, who produce the annual Canadian Property Tax Rate Benchmark report, suggest in their 2019 edition that lower commercial property taxes, “help make cities more competitive, promote job growth and investment, and subsequently generate more stable and sustainable revenue.”

They report that the 2019 ratio between commercial to residential tax is 1.71 in Saskatoon and 1.74 in Regina.

That is to say, the commercial tax rate is 1.71 times what a residential tax on the same assessed property value is.

Saskatoon and Regina are the lowest ratios in Canada, with Montreal topping out at 3.93 times commercial to residential spread.

An increase is an increase for everyone

This is the biggest tax hike in recent history for all property owners, commercial and residential.

The City has consistently posted increases of 2.11 per cent and 2.88 per cent from 2016 to 2019.

The 3.7 per cent increase for 2020 will be followed by a 3.86 per cent increase in 2021.

I live in a modest home in an established neighbourhood.

So far as City services go, we received the bare minimum last year; mostly bi-monthly garbage/recycling pick up and one street sweep.

In 2016 we paid $3,157.69 between the City and Education property taxes; that number will jump a total of 11.43 per cent by 2020 to $3,518.70.

That may not seem too impactful, but can you imagine the spread those numbers equate to as they are applied over multi million-dollar portfolios?

No postponing bad news

If the current increase isn’t tough enough to swallow, there will be no big reveal for the 2021 budget as its too been set.

I’m not sure if I prefer that bit of news in advance or not. It certainly allows me to start my complaining earlier.

And if you’re curious what I think might be one of the reasons the City of Saskatoon tax increases continue to outstrip the inflation rate by nearly double?

I’ve questioned if there is enough research on revenue being generated from lots in urban sprawl expansion versus the true cost of extending service to those areas.

I’m not convinced the City has really identified the full cost of these neighbourhoods and passed it onto those property owners.

I’ve said it before, density is the only way to tax salvation in my mind.

Posted by Kelly Macsymic

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