There has been a fair amount of talk around the North of late about taxes and the fairness of the system that is currently imposed by municipalities and the province. However, in Snow Lake the fairness issue is more specific to one group of ratepayers - those who have homes within the community's cottage subdivisions.
I did a bit of online searching to see what I could come up with in relation to a fairer way of taxing properties that have a lower level of services as compared to people who live within the confines of the town proper. It seems that Snow Lake cottage owners aren't the only taxpayers with such a problem, because I did find some interesting info way out in Halifax, Nova Scotia!
There is a grassroots movement in that community that is attempting to overhaul the way the City of Halifax levies their taxes. Before I explain how this proposed new system works and how it could be applied in Snow Lake's case, perhaps I should provide and overview of how Manitoba taxes are currently arrived at.
Firstly, taxes are based on assessment. The province sets the assessed value of a property, the municipality sets the mill rate based on this assessment (in relation to the amount of money they need to raise), and taxes are levied as a result of a combination of the two.
The Province of Manitoba's property assessment website advises that assessment is the determination of a property's fair market value for the purpose of property taxation. They determine a property's assessed value by accounting for factors such as location, size, age, and local real estate market conditions on a specific reference date. The assessment of any property also consists of the applicable property class and any tax exemptions that apply to it. However, for some unknown reason and to the dismay of many cottage owners, it doesn't seem to take into consideration a property's services or the occupant's access to them.
All assessable property in Manitoba is allocated to defined classes and each one has a portion percentage associated with it, meaning that only a certain portion of market value is used when calculating property taxes. For example, residential property pays tax on 45 per cent of its market value. The "portioned assessments" appear on the property tax bill as the amount to which mill rates are applied and a property can have more than one class. Which all means high market value (based partially on area sales during the last assessment period) equals high taxes (apparently, regardless of services).
What the Halifax Tax Reform Proposal attempts to do is set up a service-based tax system, charging a flat rate for each service that is used by a taxpayer. They propose that municipal services be divided into nine service-based taxes: hydrants, solid waste, local roads, local recreation facilities, local sidewalks, local transit (would not apply to Snow Lake), regional roads (eg: cottage roads), regional transit (would not apply to Snow Lake), and a regional tax rate (RCMP, fire, libraries and other).
Within the Halifax proposal, there are clear rules as to who pays for which service (with consideration given to those with a limited ability to pay). Hydrants, solid waste and local roads are to be paid for by those who have the service. Local recreation facilities, and sidewalks would be paid for by those within a set distance of the service (a shorter distance for sidewalks and a greater distance for recreation facilities). Regional roads would have tax rates that vary for how far men and equipment have to travel to maintain them. The regional tax rate would be paid by all (however, in Snow Lake's case, it might be fairer to take into consideration a person's distance from services such as fire protection).
Also in the Halifax Proposal, rates for provincial services such as education would not change; however, in our case that is something that the government should definitely look at, as some of these people presently pay education tax on multiple residences. Regardless, unlike the current tax system, service-based taxes would be paid at a flat amount. Each home would pay the same amount with a reduced rate for apartments and tax bills would no longer vary by the value of the property.
The tax reformers from Halifax state that under the reformed tax system many of the inequities in property would disappear. Taxpayers would easily understand what they are paying taxes for and how much the service costs. The system should be more equitable, more stable, simpler and more transparent. And most importantly, its proponents say that the system would raise the same amount of tax revenue as the current structure.
