Council approves 1.5% tax hike following budget deliberations

Dec 3 2019, 3:30 pm

Calgary City Council came to a decision on Friday about what kind of increase, if any, Calgarians would see to their municipal tax rate this year.

Council approved a 1.5% increase, which will preserve the Calgary Police Service’s and the Civic Partners’ budgets heading into 2020, according to a release from the City of Calgary.

However, the increase will also mean a higher monthly property tax for homeowners — especially when coupled with the fact that council shifted tax responsibility from 49% residential and 51% non-residential to 52% residential and 48% non-residential, taking a portion of the tax burden that had been on businesses and placing it onto homeowners instead.

These changes will see an average of approximately $12.50 more per month in property taxes for a typical residential home.

It is noted in the release, however, that $1.14 of that total is due to the reductions in fine revenue, biological testing, and cannabis tax revenues as a result of the 2019 provincial budget, while $11.36 is a result of the shift in tax responsibility from businesses to homeowners.

An additional increase of $4.45 per month will be placed on the typical residential home in order to “recover the balance of the 2019 provincial education requisition that was underestimated due to the delay in the provincial budget.”

“Council understands the economic pressures on both citizens and businesses and the need for a balanced approach. With the decision Council made yesterday, we are able to continue to support Calgary’s economic recovery with minimal impact to the services our citizens and businesses rely on every day,” said David Duckworth, City Manager, in the release.

“The scenario supports Calgarians today, while allowing Administration to find solutions to continue to modernize the delivery of municipal services for the future.”

Council has also put funding towards reducing the tax rate increase to 0% by 2021.

It is noted in the release that only 63% of property tax bills actually goes to Calgary, while the remaining 37% goes to the province, and is merely collected by the city.

Approximately 138 city jobs will be lost as a result of the “combined impact of all of council’s decision,” the release states. It also states that the 2020 adjustments would maintain services at the Beltline Aquatic and Fitness Centre and the Inglewood Aquatic Centre as well as restore funding to Calgary Transit to reduce overloading on some routes.

“Administration and Council developed collaborative solutions that allow us to continue to deliver the services that Calgarians expect, while managing our finances in a measured and prudent manner,” said Carla Male, Chief Financial Officer, in the release.

“We will be working hard over the coming months to move towards a more systematic and planned approach to identifying and realizing savings throughout the organization.”