Next Four Years Could See Five Per Cent Tax Hikes

It is going to prove difficult for city council to move away from the annual five per cent property tax increases in its next multi-year budget.

Mayor Naheed Nenshi and councillors will be setting tax rates and service level increases for the next four years in summer and fall 2014. The city’s projections show that the fiveper cent tax increases will be needed in 2015 and 2016 to keep up with their costs.

Nenshi is hoping for a city charter that gives the city new revenue-generating powers, or a different provincial funding deal that allows Calgary not to rely so heavily on property tax.

City divisions have been conducting “zero-based” reviews, but there hasn’t been any big savings. Outsourcing some of the services to the private sector, may be an option that the city looks at doing to drum up some savings.

The current property taxes are collected based on property size, which causes some homeowners to pay a large amount of taxes. Nenshi’s goal is to have the taxes charged based on revenue, rather than property size, making it a fairer taxing system.

Last month, council voted against reversing the $52 million tax room increase, they instead approved a rebate of the 2014 money and using the tax room from 2015 to 2024 to fund a new transit line.

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