Thanks to strong performance in the real estate market and new construction, property assessments in New Brunswick have risen to a total value of $81 billion. This is an increase of $8 billion or 10.9% since 2021. However, the impact of this performance is not quite good news for property owners.
The N.B. government has mailed out large assessment increase notices this week and is asking municipalities to consider this appreciation when setting their property tax rates from 2023. Over 477,000 property assessment notices have been sent out. The residential segment accounts for $7.11 billion while non-residential properties account for $880 million.
These notices are a determination by the government as to how much each property will be worth as of January 1, 2023. Unless challenged, this value is what will be used by the municipality, and possibly the provincial government, in calculating municipal and secondary property tax bills. Homeowners are expected to be the hardest hit as housing prices have been on the rise in the province over the last two years.
Services New Brunswick Minister, Mary Wilson, has attributed the rise in assessment values to strong real estate market growth and population growth. The province’s population grew by 21,000 in 2021—the highest increase in a year since 1867.
This is however not the first time that the province has experienced assessment increases and resulted in lowered property tax rates. Nearly half of the province’s cities and towns undertook these measures in 2021, but now the value and number of increases are much higher.
It is concerning as some residents have said that their property taxes are likely to increase beyond what they paid in their mortgages. Those on fixed incomes like pensions are also concerned they may have to sell their homes as they may not be able to afford the higher taxes.
Several cities and towns, including Moncton and Riverview, have confirmed they will be considering lowering their tax rates, but this would be weighed against other budgetary considerations such as revenues, inflation and provincial grants. ‘
Former Saint John mayor, Don Darling, has however criticised the provincial government on how it arrives at its assessments, noting that there were seemingly some organisations, industries and taxpayers receiving more tax breaks than others. Saint John councillor, David Hickey, highlighted the case of the Saint John Regional Hospital which was reported to have received a higher tax increase than 13 different industry-based companies altogether. Darling and Hickey have long advocated for industries to pay their fair share of taxes.
Contact Accountancy Insurance
We would love to hear from you.
About Accountancy Insurance
Thousands of accounting firms offer our tax audit insurance solution, Audit Shield to their clients. Find out why.