CFIB study reveals commercial property tax rates still almost two and a half times residential rate
CALGARY – (Monday) the Canadian Federation of Independent Business (CFIB) released Entrepreneurs Deserve Property Tax Fairness, a report which analyzes residential and commercial property tax rates levied by Alberta’s 86 municipalities with populations greater than 5,000 from 2003 to 2014, the most recent data available province-wide. Findings show commercial property owners are still paying almost two and a half times what a residential owner pays, based on the same assessed value of property.
“Many local governments are currently deliberating municipal budgets and the property tax hikes that seem to inevitably come along with it. Unfortunately, far too few municipal governments seem to be taking Alberta’s current economic climate into consideration. There is only so much independent business owners can take on the chin before they reach a breaking point”, says Amber Ruddy, Director Provincial Affairs, Alberta.
The property “tax gap” is the differential between commercial and residential property tax mill rates. Overall, the tax gap Alberta-wide held steady at 2.43 in 2014 down slightly from 2.45 in 2013. The report also pays special attention to Alberta’s 18 cities.
Calgary and Edmonton have the most work to do with gaps of 3.73 and 2.65 respectively. While Calgary has a bigger gap, Edmonton residents and businesses pay substantially more on the same assessed value.
Cities
| Municipality | Tax Gap | Municipal Commercial Taxes ($) | Municipal Residential Taxes ($) | Provincial Rank (1=Worst) |
| Calgary* | 3.73 | 1,069 | 375 | 13 |
| Edmonton | 2.65 | 1,470 | 554 | 26 |
| Lethbridge | 2.44 | 1,828 | 751 | 29 |
| Wetaskiwin | 2.28 | 1,966 | 863 | 32 |
| Medicine Hat | 2.25 | 1,364 | 605 | 33 |
| Wood Buffalo, Regional Municipality of | 2.22 | 402 | 181 | 34 |
| Red Deer | 2.04 | 1,222 | 599 | 40 |
| Cold Lake | 1.96 | 1,162 | 594 | 44 |
| Fort Saskatchewan | 1.87 | 900 | 481 | 48 |
| Airdrie | 1.85 | 789 | 426 | 50 |
| Grande Prairie | 1.61 | 1,534 | 955 | 57 |
| Lloydminster | 1.60 | 782 | 489 | 58 |
| Brookes | 1.58 | 1,188 | 751 | 60 |
| Spruce Grove | 1.56 | 867 | 554 | 62 |
| Camrose* | 1.52 | 1,159 | 768 | 63 |
| St. Albert | 1.42 | 1,089 | 768 | 68 |
| Leduc | 1.32 | 834 | 633 | 78 |
| Lacombe | 1.20 | 873 | 725 | 81 |
| Regional Average
|
1.95
|
1,139
|
615
|
Source: CFIB analysis of AB Government published property tax rates 2003-2014. * Denotes addition of business tax.
CFIB recommends provincial and municipal governments ensure the property tax system becomes more balanced over time by:
- introducing legislation to put a cap on the maximum tax gap allowed;
- reducing the tax gap through restraint in operating spending; and
- holding operating spending growth to no more than the rate of inflation and population growth.
“Mayors and Councils must hold to line on property taxes. Anything short of that demonstrates their priorities don’t align with the current challenges entrepreneurs are facing”, concludes Ruddy.
As Canada’s largest association of small- and medium-sized businesses, CFIB is Powered by Entrepreneurs™. Established in 1971, CFIB takes direction from more than 109,000 members in every sector nationwide, giving independent business a strong and influential voice at all levels of government and helping to grow the economy.