Tax Pulse by DMA Canada- Western Update

by DMA Staff | Apr 13, 2017
Banner- Issue 2

Upcoming Deadlines:

  • In BC, the deadline to appeal assessments to the second level is April 30.
  • Rural Alberta assessment notices are being mailed throughout the spring. There is a 60-day review period before the appeal deadline.
  • Tax rates are being set over the next 30 days in Alberta and will be reflected on the upcoming tax notices.
  • Rural Saskatchewan will be sending assessment notices over the next 1–4 months based on the new valuation cycle

Rural Alberta Tax Rates:

2017 Tax Rates: The assessment values for wells will drop over 14 percent and pipelines over 9 percent. This is due to Alberta Municipal Affairs applying modifiers to reflect construction costs related to these assets year over year. For the current year, they have implemented factors to decrease these values, although they have not decreased the modifier for machinery & equipment.  In municipalities that have a significant well and pipeline presence, there may be an impact felt by other property owners as tax rates will likely rise to offset the drop in these specific assessment values.

Rural Alberta 2018 Changes that could have a Potential Impact:

  • Centralization of Industrial Assessments – Major Industrial and oil & gas properties will be considered Designated Industrial Properties. This means the assessment will be handled by the Province going forward, although they may use contract or existing assessors for some period or longer. With the Province now ultimately being responsible for the creation of the assessments for these property types, the hope is there will be efficiencies and consistencies gained.
  • Condition Date Change – The state and condition date the industrial property is assessed will change from December 31 in the year prior to the tax year, to October 31. This will coincide with the deadline for linear property. This will take effect for 2019 taxes and forward, so it shouldn’t have an impact on the 2018 estimate.
  • Supplementary Assessments – The Province will be preparing assessments for property the date they are completed. This will mean new additions will be assessed and taxed (if the municipality chooses) the month they are put into operation rather than on an annual cycle. The municipality still has the option to tax them or not.
  • Subclasses for Property – Still yet to be totally defined, municipalities will have the option to create subclasses under residential and non‐residential property. This is similar to other jurisdictions, where these assessment classes will have different tax rates depending on where the municipality wants to focus their taxing efforts. Municipalities will be able to raise taxes for certain classes of property without having the impact transfer to all non‐residential properties.
    • Requests for Information for the rural properties typically come to property owners in the fall with a deadline to respond near the end of the calendar year. Expect this to change this year as the transition to a centralized assessment for industrial property occurs. There has been discussion of a Request being sent to ratepayers in July 2017 with a September response date. This will be requesting information current through the end of 2017. As much of this will still be unknown, there will be follow-up required. This is information that will be used to create your upcoming assessments so care should be taken to ensure the responses are as accurate as possible under existing legislation. A failure to respond could result in a loss of the right to appeal your assessment for 2018 taxes.
  • Tax Rate Ratio Caps – The Province has introduced a projected ratio cap of 5 to 1. This means that any class of property created under the sub‐classes cannot be more than 5 times the amount of the lower rate class. Currently, the Alberta average difference between the residential and non-residential property by municipality is less than a 3.5 to 1 ratio

Need more information?
DMA Canada’s expert property tax team is ready to help!

Contact Jon dEasum for more information:

Jon dEasum
Senior Director
403-263-2141, ext. 2711