Directly impacts thousands of property owners, in turn benefiting countless business tenants and sub-lease holders, paving the way for a stronger Calgary.
Late Monday, City Council approved $30 million in tax relief for Calgary businesses who have experienced the most significant municipal property tax increases over the past four years.
The approved 2020 Non-Residential Phased Tax Program (PTP) will cap eligible property owners’ non-residential municipal tax increases to 10% of their 2019 amount. It will be calculated by using the property’s 2019 taxes, after that year’s PTP reductions are applied.
In doing this, The City ensures that non-residential property owners who faced the largest tax increases over the last four years receive needed tax relief. Additionally, that this Phased Tax Program will be received by the largest number and range of properties to offset the “bow wave” effect of past year’s Phased Tax Programs and lessen the impact of year-over-year municipal tax increases for non-residential property owners.
Not only will this benefit 5,071 non-residential property owners, it is expected that a positive economic benefit will be realized by business tenants who lease space within the non-residential properties when the Phased Tax Program credit is passed to tenants.
“It’s important that Council take this step to extend the PTP for one more year, providing tax relief for Calgary’s small business owners,” said Mayor Naheed Nenshi. “As we transition into the new tax share, we’ve built a system which, to the extent provincial law allows, is more forgiving for commercial property taxes. Moving forward, I am eager for the recommendations that will come forward from the Financial Task Force on a tax and revenue policy and framework for both provincial and municipal jurisdictions.”
Over the past four years a total of $246 million in tax relief programs have been approved to mitigate the impact of municipal tax increases on eligible non-residential properties through Phased Tax Programs. Non-residential property owners do not need to apply for this program. The Phased Tax Program credit will be applied to their 2020 municipal taxes based on their eligibility.
The 2020 Phased Tax Program is further helping to support non-residential property owners and business tenants in addition to Council’s decision on November 29, 2019. The tax responsibility was shifted from 49% residential and 51% non-residential, to 52% residential and 48% non-residential. This shift equates to an approximate 12% decrease in non-residential municipal taxes, excluding rebate programs and an estimated 7.5% increase for the typical homeowner or about $12.50 a month.
Over the following week, The City will be working to ensure non-residential property owners have the information they need to understand, review and check for eligibility. Non-residential property owners may visit calgary.ca/ptp after Feb. 11, 2020 for information on eligibility. They are also encouraged to review their assessment information and calculate their estimated 2020 property tax amounts online after February 11. The City’s property tax calculator will be updated at that time to show how the Phased Tax Program credits further reduce non-residential property taxes. Additional information will also be placed on Assessment’s websiteAssessment Search.
The City continues to work with external experts through its Financial Task Force to identify options and opportunities to decrease the volatility of annual property taxes to individual taxpayers. In doing so, the Financial Task Force may consider revisions to The City’s Property Tax and Assessment Policies. They are expected to report back to Council with their findings and proposed recommendations later in 2020.