Fifth Street in Moncton is typical.
Rising
property values in the area neighbourhoods caused tax assessments on
the street to jump an average of 18 per cent in 2022, 20 per cent in
2023 and another 18 per cent this year.
Robert Caverly bought a
house on Fifth Street in 2021, but in June he sold it and moved across
the provincial border to a spot near Amherst, Nova Scotia. He cites
rising residential property taxes as a major reason.
"We were actually planning on staying in Moncton," said Caverly in an interview.
"But it's like we decided, you know, with the increase in the taxes, that was a big thing."
At
the time Caverly bought his Moncton house it carried a municipal tax
bill of $2,060, based on an assessed value of $123,400. This year the
assessment was up to $316,700, and the bill he received had nearly
doubled to $3,947.
Robert
Caverly sold his house in Moncton this year and moved across the border
to Nova Scotia. He said rising property taxes were a major reason
behind the decision. (Submitted by Robert Caverly)
About $400 of the tax increase was caused by Caverly building a garage, valued at $28,000, on the property.
But
most of the increase, more than $1,400 worth, was caused by the tax
assessment on the house itself escalating rapidly, and residential
property tax rates in the city of Moncton are not falling fast enough to
compensate.
More concerning for Caverly was that the increases were not going to stop.
New
Brunswick has a rule that unless a house is substantially renovated or
changes owners, property taxes on large assessment increases have to be
applied gradually, by a maximum of 10 per cent per year.
In
Caverly's case that rule meant $43,097 of the $193,300 increase in the
taxable value of his Moncton house, over three years, was sheltered from
being taxed in 2024.
But in 2025 and 2026, had he kept the
house, those protections would expire and, at current Moncton property
tax rates, an additional $621 in tax would be applied to the house,
potentially raising the annual tax bill to more than $4,500.
Houses
on Habour Terrace in Saint John were among three dozen in their
neighbourhood to receive assessment increases above 50 per cent this
year. Most of the property tax increases that will come with that
change will be levied on a delay. (Robert Jones/CBC)
For Caverly, the prospect of five straight years of compounding tax increases was too much.
"What additional services were they providing to have that kind of increase?" he asks.
"That was just ridiculous."
Large
assessment increases, causing delayed property tax increases a year or
two after assessments have risen, is something that Black is worried
most homeowners are not prepared for.
"I would say, based on my
personal experience and who I've spoken with in my municipality, I think
that [most] people don't understand." said Black.
"Some people do understand, but there's a lot of people who don't. Most of the time people are shocked by that."
All
26 houses on Knox Drive in Moncton are facing property tax increases in
2025, 2026 and 2027 unless the city can find a way to cut property tax
rates in the city. (Google)
Property
records show that assessments on residential properties in Moncton have
risen steeply in virtually all neighbourhoods, and there are now more
than 17,000 houses in the city on a time delay for property tax
increases in 2025.
On many Moncton streets, like Knox Drive, every house is in that situation.
The
26 homes on Knox have had their property taxes increase by about $400
over the last three years because of assessment increases, but that is a
fraction of what is coming.
Unless Moncton drops its tax rate
further, homeowners on Knox Drive are facing additional average
increases of $1,000 each over the next three years because of assessment
increases.
And it is not just Moncton.
In Fredericton, more
than 11,000 homes are facing their own 2025 property tax increases for
similar reasons. In Dieppe, at least another 6,000 houses are in that
position, and in Saint John it's more than 14,000.
Jerry
Iwanus calls New Brunswick's property assessment and tax system
'broken.' He says municipalities need to dramatically lower tax rates on
houses when assessments on houses are surging, and they should be given
the power to do that. (Submitted by Jerry Iwanus)
Jerry
Iwanus says what is happening with property assessments and taxes on
homes in New Brunswick proves the system needs major reforms.
Iwanus
is a former property assessor who has worked in multiple provinces,
including New Brunswick, and he recently wrote a book, called Taxing New Brunswick, that offers advice on how to challenge a property assessment in the province.
Iwanus is adamant there is no reason for rising assessments on homes to cause tax increases for homeowners.
"There is no way to sugar coat this: the property assessment and tax system in New Brunswick is broken," he writes in his book.
In
an interview, Iwanus said if property assessments on houses and
apartments buildings are surging, municipalities need to have the
freedom to drop tax rates on those buildings. That, he said, would fix
the problem of runaway property tax bills, in a way that phasing in
large increases only delays.
"Overall, if residential assessments
increase by 40 per cent, then you lower the tax rate by 40 per
cent. That's revenue neutral," said Iwanus.
Saint
John cut tax rates on industrial properties in 2024 even though it
didn't want to. The reduction was required to allow for a residential
tax cut and comply with provincial rules that forbid houses from being
charged a tax rate less than 58.8 per cent of what businesses pay. (Robert Jones/CBC)
"The
system needs to be changed to include different tax rates for different
property classes. So the municipalities actually have some flexibility
in that regard."
In Canada most municipalities have the power to
neutralize the cost of rising assessments on houses by cutting property
tax rates that apply to houses.
But in New Brunswick, property tax
rates on houses are connected with tax rates on commercial, government
and industrial properties and are difficult to adjust independently.
Currently,
New Brunswick municipalities are not allowed to set property tax rates
on houses any lower than 58.8 per cent of what business properties are
taxed in their community.
Last year that rule forced Saint John
city council to cut property tax rates on commercial, industrial and
government properties in order to lower tax rates for homeowners.
In
the end, only about $2.1 million of a $3.8 million tax cut passed by
the city made its way to houses and apartment buildings because of that.
Saint
John finance commissioner Kevin Fudge told councillors last year
provincial property tax rules were limiting the city's ability to direct
property tax savings where it wanted. (CBC)
Saint
John finance commissioner Kevin Fudge told councillors during budget
deliberations the city was powerless to direct tax cuts where it wanted.
"We would really like to have no restrictions and set what we want to set," Fudge told councillors at the meeting.
"We
would like the ability to set as many classes as we want and set the
rates the way we want, based on what works for the City of Saint John."
That
is close to what was promised during the 2018 provincial election.
Progressive Conservatives pledged to "empower municipalities to have
greater control over their own affairs, including greater powers over
taxation."
After winning that election, a second commitment was
made to have financial reforms in place by January 2025 but that time
table has been abandoned.
In an email, a spokesperson for the
province said talks with municipalities about financial reforms are
ongoing but that any changes that come will be for the 2026 calendar
year.
WELL, the Anglophones DO HAVE nine English language school boards that are Constitutionally guaranteed by the Constitution Act 1867, Part VI ---- Distribution of Legislative Powers, Section 93; and MORE IMPORTANTLY, by the Constitution Act 1982, Part I ---- Canadian Charter of Rights and Freedoms, Section 23 --- Minority Language Rights.
In addition, there are English language hospitals in Montreal and vicinity.