THUNDER BAY -- City manager Norm Gale wants the public to better understand the difference between the two terms as Thunder Bay continues the process of shaping the 2024 operating and capital budget.
“The tax rate doesn’t equal taxes paid," Gale said after Tuesday night's meeting.
Across 15 Ontario municipalities, the current proposed municipal tax levy increases range from 2.5 per cent to 14.2 per cent - with an average of 6.7 per cent. Thunder Bay’s proposed increase is currently 5.5 per cent.
Gale acknowledged that Thunder Bay does have the second highest tax rate in Ontario but he stressed that it doesn’t mean residents face the second highest taxation in Ontario.
“The tax rate is the great leveller. Think of a typical home in Toronto where there's a family and the same home in Thunder Bay where there's a family, they will draw the same services, right?
"But that home in Toronto is worth four times the home in Thunder Bay. Should the Toronto family pay four times the taxes as the Thunder Bay family? The answer, of course, is no. This is where the tax rate comes in," he said.
“The greater the property value, the lower the tax rate. The lower the property value, the higher the tax rate. This is why the family pays basically the same property taxes in Toronto than they do in Thunder Bay. As properties increase in value in Thunder Bay, the tax rate will decrease. The tax rate does not equal taxes paid.”
During the long-term outlook presented by staff on Jan. 23, the proposed tax levy impact would mirror 2023 ratios.
For a single family detached home that has a median assessed value of $219,000, the impact on their tax bill would be $201 per year.
Payment is based on the amount of the tax levy and your property assessment value which is determined by the Municipal Property Assessment Corporation.
The public has a chance to weigh in during an informal question and answer session in the Embassy Suite at the Victoria Inn this afternoon.
Council will review the budget on Jan. 30, Feb. 1, Feb. 5 and Feb. 7.
The budget is scheduled to be ratified on Monday, Feb. 12.
