Evidence landlords cite in campaign to end N.B. 'double-tax' comes under scrutiny

Some landlords are renewing their call for the New Brunswick government to cut property tax rates on rental buildings in the province — but they are offering little evidence to support claims that they currently "pay property taxes 251 per cent higher than the Canadian average."

On Jan. 28, Service New Brunswick issued the last batch of property assessments for 2022, including new assessments on several hundred apartment buildings.  

Valuations on some buildings have jumped 50 per cent and more from last year. On Friday, that reignited a call by landlords for the province to cut rental property tax rates significantly in next month's budget to save a big jump in their tax bills.

"The New Brunswick Apartment Owners Association is calling on the Province to implement a formula that reduces the provincial tax rate so that landlords and tenants pay the same taxes as before these major increases," said association president Willy Scholten in a written statement.

For several years the association has claimed, wrongly, that New Brunswick is the only province to subject apartment buildings to both provincial and municipal property taxes. Several provinces engage in the same practice but Friday the group also made it clear it wants what it calls New Brunswick's "double tax" ended for good.

"We are also calling on the Province to continue this formula of offsetting assessment increases in future years until this double taxation is finally eliminated," reads the statement.

New Brunswick does have higher tax rates on rental properties than many jurisdictions, but that does not necessarily lead to higher tax bills.

New Brunswick also has lower property assessments than most jurisdictions.  Even with recent assessment increases, the tax bills landlords pay on rental properties in New Brunswick are often similar to places with much lower tax rates.

In Saint John, Killam Real Estate Investment Trust — New Brunswick's largest landlord — owns several buildings including the 52-year-old Fort Howe apartments.  

The 153-unit building is in line for a 2022 property tax bill of $217,000. That's almost the same as the $213,000 property tax bill Killam is facing on a 146-unit high rise of the same vintage on Oak Street in Dartmouth, N.S.

Property tax rates on the building in Saint John are more than double those in Dartmouth. But the assessed value of the Dartmouth building is more than double that of the building in Saint John.  The two elements largely offset each other and as a result, the property tax bills for each building are nearly identical.

The New Brunswick Apartment Owners' Association includes only tax rates when it claims taxes paid on rental properties in New Brunswick are higher than elsewhere, an issue it rarely makes clear in its materials.

It also mostly compares New Brunswick tax rates to large urban centres with Canada's highest property values and lowest tax rates.  

In the nine cities outside of Atlantic Canada it uses to calculate  its 17-city  "Canadian average" tax rate, all nine are major cities including Toronto, Vancouver, Victoria, Montreal, Winnipeg, Calgary, and Edmonton.