Fair Taxation

What's the problem?

Why do our property taxes seem high and our roads and sidewalks still so poor? Over the years City Council has shifted taxes off business (especially big business) and onto residential property owners, even though commercial taxes are higher.

Regina has one of the lowest ratios of commercial-to-residential property taxes in Canada. That means in Regina residential property owners pay over 60% of all property taxes. That’s not fair.

As your councillor in Ward 3, I will continue to push for a change in our current property tax structure with the goal of equalizing the business and residential tax contribution, bringing Regina in line with other municipalities.

Council also needs to review the costs associated with “sprawl”. We know that “growth pays for growth” when it comes to large, capital projects, but not operational expenses. New neighbourhoods are built without access to quality public transit for these reasons, deepening our dependence on single-occupancy vehicles. This makes Regina less economically and environmentally sustainable.

Fair and adequate taxation provides the revenue we need to maintain good roads and pipes, and to build and sustain safe and vibrant communities. Residential property owners shouldn’t have to carry a majority of the burden. And we can’t keep mortgaging our infrastructure by subsidizing sprawl. Growth does not necessarily pay for growth on the operational side.

What else is on your tax bill?

Many believe that their entire tax bill goes to the City. It doesn't. About 60% of what you pay goes to the municipality for city services and infrastructure, but the rest goes to schools and libraries. The Education mill rate is set by the provincial government but collected by the City of Regina. In 2017 the province unloaded additional expenses onto the shoulders of municipalities by changing the Municipal Operating Grant and suspended grants-in-lieu for a time. It's important to contact your elected school trustees and MLAs to talk about that.

Reform is needed

Property taxes provide a majority of revenue for municipalities across Canada, and Regina is no exception. While important, they're also regressive, meaning that the your tax bill isn't really connected to your ability to pay. Here's a dated, yet relevant, source by Statistics Canada. The province restricts what cities can and cannot charge, meaning we're stuck with this system unless we see broader changes at the provincial level. So what might that look like?

For starters, a hotel tax, like in most provinces. This would generate a form of revenue that is tied to economic conditions and would provide a strategic source of income that we could invest in amenities that attract people to the city. Some estimates suggest that a 4% hotel tax could bring in between $3 and $4 million per year. That was before COVID, of course. Depending on the state, American cities rely less on property taxes because of their access to alternative sources of taxation income and fees. We should also look into shifting the balance of costs onto under utilized property, like parking lots.

We should also review the assessment cycle and process to ensure that the assessed value of your home is more closely aligned with current market conditions. These rules are framed by the Saskatchewan Assessment Management Agency, or SAMA. Cities like Regina are bound to follow these guidelines, along with other rules set out in the Cities Act. Part of the problem is that Saskatchewan is governed as if most people live in rural areas, when they don't. About half the population lives in Regina and Saskatoon, and the balance are distributed across a variety of small cities and towns. We need an urban focus in government to make broader changes.

How do we change?

For starters, we should all learn about how the City's tax structure works. There's a lot of information on-line you can access, especially in a reassessment year. We can also examine the municipal budget each year to ensure that we find savings through innovation and efficiencies, while continuing to invest in infrastructure and services that people demand. As a councillor, I receive calls for more and better services for 11 months of the year. Regina is growing and has an unprecedented number of roads, parks, sewer lines, and a critical infrastructure deficit. So what has to happen?

Finding savings can only go so far. As a councillor, I'll put my name forward to join the board of Municipalities of Saskatchewan (formerly SUMA) to rally support in the city and across the province for changes to our tax system to make it more progressive. I've also advanced a motion that asks city administration to bring a report back to Council in 2021 on tax reform options we can implement with the powers we already possess. We also need to advocate for increases to the Municipal Operating Grant, which is PST revenue sharing formula offered by the provincial government.

Also consider that the City collects millions of dollars in taxes on behalf of the provincial government for the Global Transportation Hub (GTH). While city officials did a great job negotiating a revenue formula with the government/GTH, it's still much less than what we would receive from other commercial/industrial areas of town.

It also comes back to the point I made earlier - we need to change the way we grow. There's a reason large, denser cities in Canada are able to afford lower property taxes. Densification is also good economics.

For information on how Regina's housing affordability compares to other cities in Canada, see this 2018 report from RBC, along with a comparison of estate taxes across jurisdictions. Regina continues to have some of the lowest land transfer taxes in the country.