Motkaluk’s tax plan a re­bate

Can­di­date de­nies rev­enue will be lost; le­gal­ity ques­tioned

Winnipeg Free Press - - WINNIPEG VOTES 2018 - ALDO SANTIN aldo.santin@freep­ress.mb.ca

WINNIPEG may­oral can­di­date Jenny Motkaluk’s touted re­form of the prop­erty tax sys­tem turns out to be a sim­ple prop­erty tax re­bate.

How­ever, Motkaluk doesn’t rec­og­nize the re­bate as a loss of tax rev­enue. On Fri­day, she of­fered a so­lu­tion to make up the lost rev­enue in a man­ner one lo­cal lawyer says wouldn’t with­stand a court chal­lenge.

“There are ex­am­ples, and lots of them, un­der the cur­rent sys­tem where spe­cific homes end up with much higher (tax) in­creases and some homes that even end up with de­creases,” Motkaluk said at a news event at her St. James cam­paign head­quar­ters.

“I don’t think it’s fair that I got a prop­erty tax de­crease while other neigh­bour­hoods had prop­erty tax in­creases far be­yond” what coun­cil had ap­proved last year.

On Thurs­day, Motkaluk had promised prop­erty taxes would only in­crease 1.16 per cent an­nu­ally dur­ing the next four years if she’s elected mayor Oct. 24. She also promised that no owner of a home in which they lived would see an in­crease in their prop­erty tax bill of more than 1.16 per cent. Nor­mally, that’s not a prom­ise politi­cians can keep, be­cause prop­erty taxes are based on a prop­erty’s as­sessed value com­bined with the mill rate. While city hall col­lects a global amount from all prop­erty own­ers, the ef­fect on in­di­vid­ual own­ers would de­pend on whether the value of their prop­erty in­creased or de­creased, or didn’t in­crease as much as oth­ers.

On Thurs­day, Motkaluk said she had found a way to ma­nip­u­late how in­di­vid­ual tax bills are cal­cu­lated to en­sure no one’s bill would in­crease more than 1.16 per cent. How­ever, de­spite hav­ing honed the plan for six months, she could not ex­plain how that would be ac­com­plished.

That changed Fri­day, when she said she’d have city coun­cil ap­prove in­di­vid­ual tax re­bates for any owner of an owner-oc­cu­pied home whose prop­erty tax bill would be higher than 1.16 per cent.

The plan is sim­i­lar to what coun­cils have done in the past when giv­ing re­bates to down­town de­vel­op­ers who build res­i­den­tial units, but Motkaluk would ap­ply it ci­ty­wide.

To make up the rev­enue, Motkaluk said the own­ers of all other owner-oc­cu­pied homes whose tax bill would in­crease less than 1.16 per cent or even de­crease from the pre­vi­ous year, will also have to pay 1.16 per cent more on their tax bill.

Lawyer Michael Mer­cury, who had ridiculed Motkaluk’s orig­i­nal plan, said Fri­day that tax re­bates are le­gal, but the city doesn’t have the author­ity to im­pose a higher prop­erty tax than an owner would ex­pect based on their as­sess­ment and the city’s mill rate.

“I’m re­ally con­fused and don’t un­der­stand what she’s talk­ing about,” the vet­eran lawyer said. “What she’s plan­ning to do amounts to im­pos­ing a sur­tax on peo­ple’s homes, and coun­cil doesn’t have the author­ity to do that.

“The prop­erty tax bill is a func­tion of the prop­erty as­sess­ment and the mill rate, and coun­cil doesn’t have the power to im­pose a sur­tax on top of the prop­erty tax.”

Mer­cury said if Motkaluk plans to give out re­bates on the prop­erty tax bill, she’ll have to find a dif­fer­ent way to make up for the rev­enue that’s not col­lected.

Motkaluk, how­ever, in­sisted there is no cost as­so­ci­ated with giv­ing tax re­bates to home­own­ers.

“It is not a cost,” she said. “When you live in Winnipeg, ev­ery­body has to pay.”

When pressed Fri­day, Motkaluk in­sisted city hall has the author­ity to im­pose prop­erty taxes greater than would be al­lowed ac­cord­ing to the as­sess­ment and mill rate.

“The sub­ject of taxes is a very com­pli­cated one, and it’s crit­i­cally im­por­tant that ev­ery (owner of a owne­roc­cu­pied home) un­der­stand what my pro­posal means to them per­son­ally, once we clear the smoke and mir­rors,” the may­oral can­di­date said.

Motkaluk also said she was not pre­pared to say if she would freeze or in­crease frontage fees and wa­ter and sewer rates.

RUTH BON­NEVILLE / WINNIPEG FREE PRESS

May­oral can­di­date Jenny Motkaluk re­vealed on Thurs­day what she de­scribes as an in­no­va­tive prop­erty tax plan for keep­ing home taxes pre­dictable for Winnipeg prop­erty own­ers.

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