Possible millions in lost revenue from payments in lieu of taxes

Petawawa

Petawawa is looking at millions of dollars in lost revenue from payments in lieu of taxes for 2021 and 2022.

Concerns are being raised by officials in the Renfrew County, regarding the governments payments in place of real property taxes for the 2021 and 2022 years.

Payments in lieu of real property taxes are used on federally owned property, such as post offices. Since the federal government is exempt from paying property taxes, they do make payments in the place of taxes. Public Services and Procurement Canada distributes approximately $560 million on roughly 14,000 properties. 

A reduction to the business education tax rate could have a significant impact on local taxpayers. 

Municipalities are general permtted to retain the education portion of the payments, for their own local use. However, since the lowering of the education tax rate, an unfavourable outcome could result in a property tax increase of 24 to 26 percent.

The Association of Municipalities of Ontario and impacted municipalities are urging federal agencies and crown corporations to make payments to municipalities for 2021 based on previous rates or find another means to keep municipal finances whole for 2021 and beyond.