In this period of tax payment, let’s talk about a very popular subject, municipal taxation. The time has come to pay our share to our city in return for services that we want to meet our expectations. This year, the increases are higher in most municipalities. For good reason, inflation?utm_source=recirculation&utm_medium=hyperlink&utm_campaign=corps_texte” target=”_blank”>the high inflation which directly affected their expenses. The increase in tax rates varies greatly from one city to another.
Quebec parliamentarians have recently been moved by the particularly steep increases in certain municipalities. Although everyone agrees that this has a direct negative impact on the owners, it is quite different when it comes to fixing the source of the problem. However, it is a recurring subject. As we know, cities are suffocating and they no longer have any leeway to maintain quality services. What to do, if not raise taxes?
Many will tell you that local governments have other tax tools at their disposal. It is partly true. The other means that a local government has to increase its revenues are, for example, the pricing of construction and renovation permits, parking rates, registration fees for leisure activities, the cost of terrace permits for restaurants and bars, fees charged for commercial occupancy certificates, etc. Fees just as popular as tax increases.
There are avenues to explore that are slow to materialize in most Quebec cities. If we applied a real concept of ecofiscality, cities could then increase their revenues and apply rules of environmental equity with regard to the polluter pays principle. This progressive municipal tax would then have a double benefit: reducing the tax burden of building owners and fighting against activities that are harmful to the climate and biodiversity.
However, this is not enough, because it is a question of playing with the same fiscal tools. Today, cities are the government authorities that face the greatest complexity of issues. Think of the social impacts of the health crisis, the housing crisis, homelessness, the reception of asylum seekers, the preservation of biodiversity, the pressure of climate change on infrastructure , the need to develop public transit, and much more. These governments are not just suffocating because of their limited source of revenue. They are also suffocating because their burdens and responsibilities increase more than others. Transfers from Quebec are no longer sufficient for the task.
Why not give cities direct access to the federal infrastructure program? Currently, Toronto, Calgary and Victoria can get money directly from Ottawa, but not Quebec cities. However, this direct access would have the advantage of reducing paperwork in Quebec, shortening processing times, launching work more quickly and, therefore, making cities more autonomous. And between you and me, that’s not what will have an impact on Quebec’s autonomy in the Canadian federation.
Let’s apply this same logic to housing issues or to access to environmental programs. Others will tell you that Ottawa only has to transfer the money to Quebec. I will tell you that this will quite simply maintain the creature status vis-à-vis Quebec and harm the autonomy of the cities and their ability to act.
Over the years, taking on new territorial issues has had the effect of putting more pressure on the finances of local governments. Result: each year, when inflation falls on the shoulders of municipal managers, the only solution is to raise taxes. It is normal for citizens to feel their throats cut. We could sum up the situation by saying that the money is in Ottawa, the powers in Quebec and the needs in the cities.
In such a context, it would be ill-advised, as some have recently done, to review or challenge the autonomy of local authorities in matters of property taxation. To better respond to the additional burdens these governments are facing, we must give them more leeway. Especially since the pressure will be greater and greater as the climate crisis intensifies.
We must get away from the rhetoric that cities are the creatures of Quebec. Local governments need more autonomy, not additional controls, because contrary to popular adage, there is no more fat to cut. The problem is one of income and not of expenditure. It’s time to change the tune, because it’s the capacity of local governments to face today’s issues and tomorrow’s challenges that are at stake, therefore, our quality of life for all.