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Over Fifty Million in Property Taxes Owed to Town and City Councils Across the Country

Town and city councils across the country are owed more than fifty million dollars in property tax. This large amount of debt that councils have been unable to collect has been a challenged for many years. Director of Local Government Clifford King says that property tax is one of the four main revenue streams for council.
Clifford King, Director, Local Government: “Essentially, most of our municipalities are operating in the red. They’re operating from one year to one year in deficit, not being able to properly finance their operations, and this really applies to all municipalities. If we were to minus the subvention or the or the transfer that government makes to municipalities, it would even be a more challenging situation.

Reporter: “A lot of the Councils have had issues with collecting property tax. So is it that property owners are hard pay?”

Clifford King, Director, Local Government: “Umm, there’s an old saying that we have in government, in local government, that if you are not willing to collect, I am not willing to pay. And so, as a municipality, I am responsible to make sure I’m getting out there and informing people, walking the streets, house to house, home to home, having programs that will encourage people to recognize the importance of them paying, and why it is important to do so. Our last check, I’ll use a loose figure, it was in the area of around 50 million dollars in terms of outstanding property taxes across the country, inclusive of all municipalities. It’s a huge amount of moneys that are in arrears that if we were to collect it, we would be able to do wonders with those funds. So, we have to keep on looking at creative ways of how we could address this trail of property taxes and where we are with property taxes.”
And town and city councils are being creative. Discounts are being offered to property owners as an incentive to have them pay what they owe.
Clifford King, Director, Local Government: “So what happens every year is that in the month of December, January, the municipalities make a submission to the honourable minister to say that under these three categories that the law allows, which are senior citizens, early payments, and arrears, under these three categories, the municipalities request of the minister to approve a certain percentage that the mayor, who is the accounting officer for these municipalities, can grant to property tax owners to say, if you come in to pay early, and early means any period before 1st of April when when taxes are due. So, that’s when early payments are due. Traditionally, the practice has been that the municipalities request for early payments between January and April. And so, they would tend to prorate or give a varying degree of early payment discounts. So, for example, if you pay at the earliest point, you get a higher discount than if you pay at that ultimate point which would be at the 1st of April. Then, of course, there are the senior citizens and those are for the property on which these elderly persons live on. Only there are senior citizens that may own more than one property. It has to be on the property where they live. And one of the ones, one of the categories that we don’t encourage is the granting of discount on arrears. We have heard the arguments over the years that it’s best I wait until next year to get a, instead of paying current year, it’s best I wait until next year when I can get or it goes into arrears and I can get a discount. So, we don’t encourage that, but some municipalities do make the submissions, and based on how they justify it, the minister would tend to approve what they’re submitting.”