Ottawa Tax Increases for 2009, less than expected.
By Jake Rupert, The Ottawa Citizen April 8, 2009
Homeowners benefit from owing less for education tax 
OTTAWA-There was a bit of good news for property taxpayers at City Hall Tuesday: the 2009 tax increases are going to be a little less than anticipated.
Last year, city council approved a 4.9 per cent tax increase for this year. But because of a regular check to make sure each municipality in Ontario is paying its due share of the province’s public education bill, the actual increase on urban Ottawans’ tax bills will be 4.1 per cent.
For rural Ottawans, it’ll be 4.6 per cent.
That’s a result of a complex set of automatic rebalancings that are intended to keep tax bills fair.
First, the value of Ottawa’s commercial properties rose much faster than the average property-value increase across the city. Ordinarily, that would mean that owners of commercial property would pay much more in taxes this year, but their rate increases are capped by law so that businesses don’t take a sudden nasty hit. That means the city must spread out that class’s shortfall among the other classes.
To raise the amount of revenue that would have resulted in an across-the-board average 4.9 per cent increase, the commercial class’s tax increase would have been 2.75 per cent with residential taxpayers making up the difference.
That would put the urban and rural residential tax increases at 5.5 and 6.6 per cent respectively.
Luckily for Ottawa homeowners, provincial policy on education taxes more than makes up for this.
Property values in Ottawa rose less than the provincewide average last year. Because of this, the city’s property taxpayers are responsible for a smaller percentage of Ontario’s overall provincial education tax — a larger share will be paid by residents of cities and towns where property values went up more than average.
After this is factored in, the overall increase on the urban tax bill will be 4.1 per cent and the rural increase is 4.6 per cent.
This means on an average residence in the urban and suburban areas assessed at $285,000, the total tax bills will be $3,580 and $3,036 respectively.
That’s $141 and $135 more than last year, but not quite as much as planned.