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PRESS RELEASE
FOR IMMEDIATE RELEASE
Tuesday, March 23, 2004
NEW PROPERTY TAX RULES MAY CONTINUE UNFAIR BURDEN ON RENTERS
OTTAWA - On Monday, March 15, 2004, the Provincial government
announced new rules that will give municipalities greater
flexibility in setting their property taxes. The current rules are
too restrictive because they do not permit municipalities to
effectively respond to market value swings that may occur between
property classes through annual reassessments.
By regulation, for the 2004 taxation year, the Minister of Finance
will modify the levy restriction allowing:
1. Ottawa, in addressing tax shifts due to reassessment, to
increase the tax ratio of one or more commercial property classes
to the extent necessary to maintain the existing municipal tax
burdens between the residential and commercial classes. (This
means that, although the total dollars collected from the
commercial tax class would not increase over that received in
2003, the tax ratio in that class may well change in order to
accomplish this.)
2. In the case of an overall tax rate increase, Ottawa can apply a
municipal tax increase to those classes that were capped, but only
by an amount that is no more than half of any tax rate increase
applied to the residential class.
Although these changes are intended to reduce the taxation
'spillover' between commercial and residential property taxpayers
due to reassessments, they could also lead to an increased share
of the already unbalanced burden placed on multi-residential
property tenants.
In recent years, Ottawa City Council has recognized some of the
multi-residential (more than 6 units) taxation ratio inequities.
Since 2000, the multi-residential ratio has been reduced from 2.33
to 2.15. With the new flexibilities provided to municipalities,
however, things may now head in the opposite direction. This would
aggravate an existing unfair situation by further augmenting the
disproportionate load on renters, who currently pay more than two
times the amount of taxes paid by homeowners.
Moreover, many tenants never realize the scope of the injustices
and inequities that exist within the system because they never
actually see a tax bill from their municipality.
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Contact:
Jacques Legendre
(613) 580-2483
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