CITY CORRECTS HUFFINGTON POST ARTICLE ON PROPERTY TAX RATES

For Release: September 29, 2014 

Saskatoon ranks among Canadian cities with the lowest property tax rates, despite a recent article in the Huffington Post (September 29, 2014) that says Saskatoon “…had the dubious honour of having the highest average property tax among major cities in Canada - $4440 by our calculations.” The City wants to take the opportunity to publicly correct this misinformation regarding the calculation of Saskatoon’s property tax rates.

“The Huffington Post article calculates property tax rates using a biased approach,” says City Assessor Les Smith. “Taking the total property value and multiplying it by the tax rate – without considering other unique factors that go into a residential property tax calculation is misleading.”

Smith says simply comparing property tax dollars per assessment is an incorrect approach to take. This assumes that the sale prices in one city for a particular house are the same as in another city. This method of calculation also assumes that the make-up of the property inventory in one city is the same as another and that the services supplied are the same as well.

The facts are that municipal property tax and assessment processes are set out by provincial legislation. To compare tax rates without considering the different legislative frameworks set out by each province, results in figures that are not truly comparable in terms of highest and lowest in Canada. Comparing taxes per capita is simpler and removes potential bias from other approaches.

“The City supplies services to people. It is people who use the parks, drive on roads, use water and use the civic facilities.  As we supply services to people, the measurement that best reflects this, is the per- capita measure. It is completely unbiased, it does not require anyone to determine what is a representative house or housing types.”

The Municipal Tax Calculation in Saskatchewan is as follows: Taxable Assessment x Municipal Mill Rate x Mill Rate Factor. In Saskatchewan, the taxable assessment is 70% of the assessed value of the property.

In comparison, the Municipal Tax Calculation in Alberta is simply the Tax Rate multiplied by 100% of the assessed value. The Municipal Tax Calculation in Winnipeg is similar to the process used in Saskatchewan, except that (a) the taxable assessment is 45% of assessed value and (b) there is no mill rate factor. Manitoba’s formula is as follows:  Portioned Assessment Value x Municipal Mill Rate/ 1000.

In Saskatchewan, property assessments are updated every four years. The last reassessment cycle was in 2013 and reflects a property’s fair market value as of January 1, 2011.

The City of Saskatoon is open, accountable and transparent. Property taxes collected are used for the delivery of key civic services.  For more information about property taxes and how they are calculated, visit the Property Assessment & Tax Tool located on the homepage at www.saskatoon.ca

For more City of Saskatoon Public Service Announcements, News Releases, Traffic Detours and Service Alerts, visit www.saskatoon.ca or connect with the City of Saskatoon on Twitter and Facebook.

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