Canadian Property Tax Rate Benchmark Report 2020
Canadian Property Tax Rate Benchmark Report 2020
Over the last 17 years, we have benchmarked and analyzed property tax rates of major urban centres across Canada to identify the ratios of tax rates between commercial and residential properties.
Property tax is the main source of revenue for Canadian municipalities and is used to fund services such as road repair, education, recreational programs and public transit. Both residents and business owners pay property taxes, but the rate they pay varies depending on whether the property type is commercial or residential – taxing authorities set these rates at their discretion.
The issue and subsequent argument that arises is the perceived fairness of the different property tax rates paid between commercial and residential taxpayers, and who should proportionally fund more, or less for education and municipal services – businesses or residents.
The findings of this report are used by Altus Group and REALPAC to create dialogue with taxing authorities about tax fairness, influence public policy and promote a healthy and competitive business environment for the real estate sector.
“What’s fair?”
The case for lower commercial property tax rates
High commercial property taxes place a greater weight on businesses to contribute an unequitable share of municipal and education budgets.
While every homeowner would appreciate paying less property tax, it is important to balance the burden paid by businesses in each city. Lower commercial property taxes help make cities more competitive and promote job growth.
Vancouver
Vancouver posted the largest decrease in the commercial-to-residential tax ratio (-36.84%) of all 11 cities surveyed.
Calgary
Calgary saw the second largest ratio decrease of all 11 cities at -22.05%, ending a six-year trend of consecutive increases.
Montreal
For the second consecutive year, Montreal has remained the city with the highest ratio, currently sitting at 4.11
Commercial-to-residential tax ratios of major urban centres across Canada
Commercial-to-residential property tax ratios compare the commercial tax rate versus the residential tax rate. For example, if the ratio is 2.50, this means that the commercial tax rate is two-and-a-half times (2.5x) the residential tax rate.
Therefore, a commercial property valued at $1 million dollars would incur property taxes 2.5 times higher than an equally valued residential property.
The map shows the 11 cities surveyed and their respective commercial-to-residential ratios. In 5 out of 11 municipalities across Canada, commercial tax rates are at least 2.5 times greater than residential tax rates.
Download the 2020 Canadian Property Tax Rate Benchmark Report today
What’s inside:
- 2020 commercial-to-residential tax ratios
- 2020 commercial rates
- 2020 residential rates
- 2003 – 2020 trend analysis
- 2020 municipal vs. provincial ratio trends
Related posts
Manage property taxes for all of your assets, through the pandemic
To help you closely align property tax mitigation strategies with the current marketplace, this white paper presents a current picture of the challenges facing nine distinct asset classes in the time of COVID-19, along with steps to mitigate the impact of this consequential expense.