Re- property taxes

Mike Fetzer | Jan 29, 2020

Editor Jeff Green’s editorial, “We can complain about lack of services, but not so much in winter”, makes me wonder why rural residents don’t complain even more, and throughout the year, about the services made available to them relative to the taxes they pay.  Many, if not most, rural residents are satisfied with the quality of services they receive as local governments struggle to deliver with relatively paltry budgets.   Rural schools are always scrambling for resources and often lack the spending ability and tools available in more concentrated population centers.  Transportation services, new infrastructure, eldercare and even health care are often scarcer or more expensive for rural residents. It may be that rural residents have grown complacent, or just tired.

As Mr. Green points out, rural residents pay much higher residential tax rates compared to urban and even suburban residents. Rural homes usually appreciate in value far more slowly than do urban dwellings, are worth less but are still costly to maintain. It’s true that urban dwellers with their more expensive homes may pay more in real estate taxes, even with their lower rates, but the system allows them to use this real estate to accumulate (often tax-free) wealth much more readily than rural residents. If real estate tax rates were equalized across each province, or even nationally, the hyper-house inflation and housing shortages in cities like Toronto and Vancouver would disappear as wealthier homeowners and real estate speculators were required to pay taxes at the same rate as rural dwellers. Suddenly, other people would not be subsidizing their real estate investments, and housing prices would drop to equitable market values. The real estate taxation system could even be made more fair with a progressive schedule where high-dollar or luxury house owners pay tax rates progressively higher than homeowners with less valuable or less luxurious houses. This works with income taxes where higher earners pay higher rates than lower earnings—so long as the system is not corrupted with special deductions, credits and schemes often available only to the wealthiest. Caution is warranted—in the United States, if one is lucky enough to get elected president by a minority of voters, you can file numerous bankruptcies, remain a billionaire, pay little or no income taxes, grow wealthier, and conceal everything from everyone. You can even enact and disguise huge new tax deductions, depreciations, credits and schemes for wealthy elites like yourself, and dupe voters by calling it “middle class tax relief.” You can use public tax dollars at your own properties and still receive huge tax deductions for depreciation and other costs. So, clearly, a provincial-wide or national real estate tax equalization plan would have to be carefully implemented, with special internal controls, to guard against some politicians and other scammers.

It’s all just food for thought. Rural residents enjoy many lifestyle advantages, but the lifestyle can come at a high cost, with more limited options and missed opportunities. Rural residents contribute much to the culture and diversity of the nation. Their land provides the food to feed the country and the trees to absorb the carbon dioxide and reduce the carbon footprint of the masses. They deserve fairer taxation and resource allocation, things that won’t come until demands are made.

Mike Fetzer