by Jason Stephen, President, Saint John Real Estate Board & Chair, Government Relations Committee, New Brunswick Real Estate Association

As we head into an election campaign, the New Brunswick Real Estate Association (NBREA) is calling on all political parties to make property taxation a primary election issue. 

REALTORS® talk to homeowners every single day. We strongly believe that property taxation is the single most important issue facing homeowners in New Brunswick.

Over the last few years, we have seen record increases to assessments and to the taxes people pay. And, not surprisingly, people are demanding relief.

This year, there were more than 8,700 appeals. That is double the number of appeals filed in 2003. This signals a very real problem. The tax assessment base, over that same time period, has increased by over $15 billion. That's an increase of nearly 50 per cent on the backs of New Brunswickers.

The current property tax system is unpredictable, it’s complicated, it’s unclear and it is inconsistent across the province.

In theory, the property tax system should be easy to understand. First, the province sends out appraisers who assess property value. That value is then used by the municipality or local service district in a property tax formula to determine the amount the homeowner pays. In this system, property assessments have a direct impact on the amount of property tax people pay. However, the current system for assessing property values is not straightforward, and it’s not easy to understand.

If the method used for collecting and applying assessment information is unpredictable and not transparent, it can discourage people from investing in New Brunswick.

What needs to be fixed?

First, property values. Many people believe there are problems with how property value assessments are calculated and question their accuracy.  Applied annual increases in property value assessments should be based on the annual increase for the average house value in the area as a whole. That would eliminate tax bill spikes for new construction or a bidding war over a particular hot property.

Second, transparency and comprehension. People are questioning how their assessment and tax bills are prepared and presented. These need to be easier for people to understand, and they should clarify and define which level of government is receiving what portion of the tax payment.

Third, fixed and low income residents. With the rate of tax increase seen in New Brunswick home ownership is getting harder and harder to maintain for those who live on fixed or low incomes. Although the province launched a rebate program for low income residents, this band-aid program is not a long-term solution.

Finally, there is double taxation. Taxing people twice is unfair. But, more importantly, it could hurt New Brunswick's economic growth potential and immigration rates for those looking to come live in New Brunswick. Double-taxing shifts an unfair tax burden to businesses and can lock people into renting rather than owning. Double taxation affects hundred of thousands of New Brunswickers; it is a barrier to economic growth that hinders the expansion of the real estate market.

The time has come to fix what’s broken. Governments have talked about doing something to improve property taxation for years, and now, we ask that their talk to turn into action.

To have your say, join us on facebook: New Brunswick Real Estate Association. To stay abreast of issues facing the Saint John Real Estate market, join the local facebook group.