Council to discuss shifting tax share to residential properties

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Calgary city councillors may make the call this week on whether or not to shift more of the property tax burden away from businesses and on to home-owners.

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The matter of the residential/non-residential tax share was pushed forward from November budget decisions to a later date. The matter is now coming before council on Tuesday.

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Currently, the split sees residential properties picking up 52 per cent of the total tax burden, and non-residential properties covering the other 48 per cent. The city does not have a business tax, so non-residential property tax is how most businesses pay a tax to the city.

The report going to council from administration asks councillors to choose one of three options: leaving the share as it is, shifting one per cent more to residential, or shifting 2 per cent more to residential.

A one per cent shift to residential properties would add $48 per year to the average residential home valued at $555,000. A two per cent shift would add $96 to their annual bill.

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The shift would be much more dramatic for the “typical” non-residential property valued at $5.1 million. That property-owner would see $1,959 in annual savings if one per cent of the tax share was shifted to residential homes, or $3,917 in savings in a two per cent shift scenario.

The report says if the province takes less than $782 million in its share of property tax, the city could provide a “one-time inflationary relief rebate” to home-owners, if council decides to shift any of the burden

Last November, Coun. Sonya Sharp asked that the tax share discussion get pushed ahead so property-owners could first see their most recent tax assessment, which they received last month.

Now that they’ve seen them, Sharp said she’s heard from residents that they can’t afford to pay even more.

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“They’ve been using the tax calculator to see what they can expect this year,” said Sharp. “But even with the status quo — so what we just approved only without a tax shift — they have huge concerns about affordability and the cost of everything else going up.”

Sharp said she’s heard the rebuttal that business-owners are concerned about their share of the taxes, but said most business-owners are also residential taxpayers.

Most Calgary businesses have already seen their tax bills rise significantly over the past decade  as downtown office values plummeted, shifting much of that burden over to properties outside the core.

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In 2019, business-owners rallied for change outside city hall, and council ultimately responded with a $130.9-million relief package.

In addition to calling for a delay on the tax shift decision in November, council also called on the mayor to advocate to the provincial and federal governments for tax relief. Sharp said she knows Mayor Jyoti Gondek has made those requests.

Sharp also asked for a report on the city’s current reserve funds, in case relief can be found there. That report is still pending.

She isn’t sure if council will make the tax shift decision Tuesday, but added it could happen, or it could be put off a bit longer, as budget finalization needs to happen at the end of March, so bills can be sent out.

“There may be a motion to defer it to the next council again, but we need to have a responsible conversation about what the shift would do with the huge concerns that we’re hearing about affordability and cost of everything else going up,” said Sharp.

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