Calgary property tax increase higher than expected, mayor criticizes province for rise
Calgarians will be facing a higher property tax rate than expected, after city council voted to confirm the 2024 tax rate bylaw on Tuesday.
Residential properties with a median assessed value of $610,000 will pay an increase of 8.6 per cent in property taxes, accounting for both municipal and provincial fees.
Non-residential properties, or businesses, will in turn see an 3.1-per-cent increase.
Initially forecasted at 7.8 per cent for residential properties last fall, the rate was then adjusted for growth across Calgary to 7.2 per cent.
So what’s responsible for the increase now?
Property values up
When the 2024 provincial budget was released at the end of February, it highlighted that while the provincial property tax rate will be frozen in 2024-2025, revenue from these fees is expected to increase.
That’s because the rate is tied to the assessment values of properties in Alberta, a tax base which has grown over the past year.
In Calgary, a preliminary assessment report presented to council last November showed an overall increase in residential assessment of 10 per cent and an increase in non-residential assessment of 3.3 per cent.
The share of property tax that the province will now claim from the municipality is 11.5 per cent, leading to the overall increase faced by taxpayers of 8.6 per cent.
The provincial property tax is also called the education tax because the government uses that revenue to fund schools throughout Alberta.
WATCH | Mayor Gondek speaks in Nov. 2023, about the then 7.8 per cent increase
Calgary Mayor Jyoti Gondek said when city council estimated its initial 7.2-per-cent hike, it was not yet aware of what the province’s portion of the city’s property taxes would be.
“When we set our budget in November, we don’t know what the province is going to be doing in terms of their share,” said Gondek.
“So the province is choosing to take the full amount of the property tax that they can based on the rate that they have in place. … They could have changed their rate, but they didn’t.”
“So they are benefiting from higher property values … and that means an increase on your provincial share of property taxes that we didn’t necessarily anticipate.”
In a statement to CBC News, Municipal Affairs Minister Ric McIver said Calgary’s property tax hike has nothing to do with the provincial government.
“The education property tax is an important revenue source that helps support the growing population of students and the need to build new schools, hire new teachers, and education assistants,” he added.
He reiterated that the education property tax rate set by the province remains where it was in 2023.
City mitigating funding shortfall
Gondek said when council initially set the city’s budget in the fall, it chose to increase property taxes as a way to make up an annual funding shortfall of $311 million.
“That was the only way to do it at that point in time,” she said.
“So the provincial government, who has been critical of how we set our tax rate, had the opportunity to do something different with theirs and they did not. And that’s the reality for Calgarians now.”
The increase to 8.6 per cent means owners of single residential homes in the city could see $26 in property taxes added to their monthly bills.
With rates now set, property tax bills will be mailed out in May.
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