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Transit tax structure changed to reflect regional benefits, local use
(Wednesday, May 27, 2009) - As part of the vote in support of the 2009/10 budget on Tuesday, May 26, Halifax Regional Council officially approved a new transit tax rate structure that will replace the existing transit tax structure.
Council had approved a new transit tax structure in principle on April 28, but then asked finance staff for additional information in advance of budget deliberations. The final transit tax structure approved on Tuesday includes revisions to the April 28 plan.
Under the new structure, taxes will be raised using a combination of an assessment-based regional transit tax as well as a local transit rate paid by all properties within a one-kilometre walking distance to any Metro Transit stop. The April 28 plan applied the local transit rate to properties within three kilometres of a transit stop and included a different sharing of costs for regional transportation and local transit.
The new structure replaces an old structure in place since shortly after municipal amalgamation. It is important to note that despite the change in structure, the taxes are revenue neutral on an HRM-wide basis. While not designed to collect more taxes overall, the new structure takes both regional and local transit benefits into account and will mean decreases for some residents, increases for some, and relatively little change for others.
Under the old system, residents in urban areas would have paid 13.1 cents per $100 of assessment for transit, while in suburban and rural areas they would pay 4.5 cents per $100 of assessment. Transit expansion to suburban and rural communities was also tied to the levying of complex area rates that proved cost-prohibitive to residents in some cases.
Under the new system, transit costs will be shared more broadly across the region, making it easier to plan for effective growth. The final transit tax rates approved by Council for the upcoming year are:
• Regional Transportation Tax - 4.5 cents per $100 of assessment. E.g. $81 on a house assessed at $180,000. All residential taxpayers, except those outside of the commuting area, will pay this rate.
• Local Transit Tax - 8.8 cents per $100 of assessment. E.g. $158 for a house assessed at $180,000. All residential taxpayers within a 1 km walking/driving distance of a transit stop will pay the local rate in addition to paying the regional rate.
District by district comparisons between the old structure and the new structure can be found at http://www.halifax.ca/revenue/tax/taxmain.html#TT.
Improvements to the municipality’s transportation network, including transit enhancements, is one of Regional Council’s five focus areas.
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Shaune MacKinlay, Manager, Public Affairs
Mayor Peter Kelly