property tax shifts

Property tax shifts continue to plague Calgary

Thursday, June 13, 2019

Nearly 12,000 non-residential ratepayers will get some relief from the property tax shifts Calgary’s sliding downtown office values triggered this year. Earlier this week, Calgary Council approved a $131-million tax credit scheme, which promises qualifying properties a rebate of at least 10 per cent of 2019 property taxes.

City analysts calculate that a non-residential property with an assessed value of $5 million would have faced a tax increase of more than $10,000 attributable solely to the tax shift. Calgary’s coincidental business tax consolidation process — phasing out a separate business tax bill and levying a single property tax bill — further complicates the issue.

Affected ratepayers were assigned an extra $250 million share of the tax burden as the assessed value of downtown office towers plummeted by about $14 billion in total. Buildings that previously accounted for 32 per cent of Calgary’s non-residential tax base, now represent about 18 per cent of assessment.

Credits will be applied to eligible tax accounts. This is the third consecutive year Council has moved to cushion the tax shift. Tax increases were capped at 5 per cent above the previous year’s level in both 2017 and 2018. However, the City defines that as separate one-time programs rather than a continuing initiative.

In addition, the combined tax rate on non-residential properties dropped 3.07 per cent from the 2018 level when Council approved 2019 property tax rates in early April. At the same time, the residential property tax rate increased 3.45 per cent from the previous year. That equates to an extra $105 on a residential property valued at $475,000.

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