Moose Jaw City Council approved its 2023 Tax Policy on Monday night by updating the mill rate factors needed before issuing tax notices.
Included were the Saskatchewan Assessment Management Agency's changes to its cap rate model that addressed concerns brought forward by members of the small business community about unfair cap rates in 2022.
According to the city, about 660 commercial and industrial properties will be impacted by the new cap rate model. Director of Financial Services Brian Acker admitted it likely addresses the issues of one group, but it won't make everyone happy.
Coun. Heather Eby believes that there will never be a happy medium.
"I think it would be wonderful if we could hit the nail on the head and make everybody in the community happy with how much taxes they're paying, but unfortunately, I don't think that's ever going to happen," she said.
Coun. Crystal Froese agreed, saying that the system isn't perfect and issues still need to be worked out.
"I still believe that there's still more work done around that area, but it is what it is at the moment," she said.
The City of Moose Jaw is continuing to close the property tax gap between residential and commercial properties assessed at the same value.
City council adopted a policy last night that would split the 4.62 per cent tax increase so that residential properties would see the equivalent of a 5.44 per cent increase and commercial properties would see a 3.01 per cent increase before adjustment for 2022 commercial appeals.
The Provincial Percentage of Value in 2021 changing from 100 per cent to 85 per cent for commercial properties has also played a role in narrowing the tax gap
The overall property tax gap between commercial and residential properties will be 1.86 times in 2023.
The city has been gradually shifting the taxation from commercial to residential properties since 2018 when the tax gap was 2.43 times.
When it came to commercial appeals in 2022, there were 68 appeals and the city agreed to adjust five of those appeals. There were six appeals that were withdrawn and no appeals were dismissed by the Board of Revision.
Fifty-six appeals went to the Saskatchewan Municipal Board. The city saw appeal losses of about $8.67 million or 1.2 per cent of the total commercial and industrial subclass assessments.
The city is anticipating similar losses of 1.2 per cent in 2023 that will need to be made up in the mill rate. Adjustments were made to the commercial and industrial mill rate factors that will result in an increased mill rate factor from 1.3895 to 1.4062. The mill rate factor for commercial and industrial properties in 2022 was 1.4112.
Tax notices are expected to be issued by the end of June with a payment deadline of July 31.