Montreal's 2023 budget: Residential property taxes to rise average 4.1%

Non-residential buildings hit with an average 2.9 per cent tax hike.

Homeowners will bear the brunt of the 2023 tax increases announced Tuesday by the administration of Montreal Mayor Valérie Plante in a $6.76-billion budget that introduces new levies for parking-lot owners and large water-consuming businesses.

Residential property taxes in Montreal will climb by an average of 4.1 per cent next year, outstripping the average 2.9 per cent tax hike targeting non-residential buildings, budget documents show.

The overall increase for residences is the highest since 2010. It reflects 3.4 per cent linked to decisions taken by city hall and 0.7 per cent by the boroughs.

Figures released by the city in September showed a 32.4-per-cent surge in property valuations for the three-year period that ended in July. Montreal said last month it would phase in that value increase over three years to soften the blow for individual taxpayers already dealing with red-hot inflation. Consumer prices across Canada rose by an average of 6.9 per cent year-over-year in October, Statistics Canada said this month.

Taxation will generate 63 per cent of Montreal’s revenue next year.

Homeowners in Île-Bizard—Ste-Geneviève will be the hardest hit: they face a six per cent jump in their 2023 property tax bill. Other notable increases include 5.7 per cent for Mercier—Hochelaga-Maisonneuve, 5.4 per cent for Côte-des-Neiges—Notre-Dame-de-Grâce and Pierrefonds-Roxboro, five per cent for Anjou and 4.9 per cent for Lachine.

Downtown residents will be somewhat spared — they can expect an average increase of 1.7 per cent next year. Ville-Marie is the only Montreal borough whose 2023 property tax increase will come in at less than two per cent.

An average single-family home in Montreal is valued at $592,167, with a 2022 property tax bill of $4,180. On that basis, taxes on a single-family home will rise to an average of $4,390 next year, the city says. Depending on the borough of residence, actual tax adjustments may be larger.

Property taxes alone represent about two-thirds — or 2.7 per cent — of the 4.1 per cent average tax increase for homeowners, budget documents show. Water taxes and service taxes each account for 0.6 per cent, while indebtedness taxes and investment taxes each make up another 0.1 per cent.

On the non-residential side, two boroughs — Lachine and St-Laurent — are each facing double-digit tax hikes. Non-residential taxes will jump 15.2 per cent in Lachine and 11.2 per cent in St-Laurent. Other increases include 8.6 per cent in Anjou, 8.2 per cent in St-Léonard and 7.3 per cent in Rivière-des-Prairies—Pointe-aux-Trembles.

By contrast, non-residential taxes in Ville-Marie will drop 2.7 per cent.

Montreal’s city council is maintaining the differentiated rate for non-residential buildings. The measure, which Montreal introduced in time for the 2019 fiscal year, shifts a bigger share of the burden to properties valued at more than $900,000.

About 70 per cent of non-residential properties in Montreal are valued at $900,000 or less, budget documents show. On average, their owners will see their property tax burden fall by about 16 per cent in 2023, the city says.

Two new levies will be applied to non-residential properties.

An existing tax on large outdoor parking lots — currently in force in the downtown core — will be rolled out across all boroughs, generating an estimated $5 million in revenue that will be used to partially finance public transit. The tax will apply to all parking lots of more than 20,000 square metres. It’s designed to encourage “optimal” land use, the city says.

A new volume tax on water use will be introduced for non-residential properties starting in 2023. The measure will generate about $15 million annually, city estimates show.

Property owners will receive a “blank bill” next year to show how much water they used in 2022 and to underline the importance of optimizing consumption. A first actual bill will be issued in 2024 for water consumed next year.

Water users will be taxed for any consumption that exceeds 1,000 cubic metres. Between 1,000 and 10,000 cubic metres, water will be taxed at 10 cents per litre; between 10,000 and 100,000 cubic metres, the rate will be 20 cents per litre; and for all consumption above 100,000 cubic metres, users will pay 60 cents per litre.

This story will be updated.

ftomesco@postmedia.com

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