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Calgary reduces late property tax penalties for 2021

Calgary taxpayers will get further relief if they’re unable to pay their property taxes in 2021, after city council took additional steps to shield residents and businesses from the impact of COVID-19.

The plan, approved unanimously during the second day of Calgary’s combined meeting of council, will reduce late penalties for unpaid property tax bills.

Currently, there’s a seven per cent penalty if property taxes are unpaid by July 1. There’s an additional seven per cent applied on October 1. Then, there’s a one-per-cent-per-month penalty if the taxes remain unpaid after January 1.

Administration proposed a reduction to 3.5 per cent on July 1 and no penalty in October. Further, the one per cent monthly penalty would not be applied until April 2022 (for 2021 tax bills).

The total cost of this program, depending on the number of accounts it’s applied to, could be $5 million.

“This tax deferral program does help many businesses and residences with a cash crunch they may face,” said Ward 5 Coun. George Chahal.

Chahal called the seven per cent interest rate “punitive” and then tacking on an additional seven and the one per cent has a significant impact on businesses, he said.

Savings being passed on to tenants?

Ward 1 Coun. Ward Sutherland asked if the city had looked into how this money trickled down from landlords to tenants.

“How do we know the difference between the actual tenant and the landlord? And if this has been effective for the tenant also?” Sutherland asked, he later followed up with a question on how the city can make sure the tenants also know about the program.

City assessor Eddie Lee said that it’s up to the property owner to distribute the property taxes to the tenants. He said it’s usually outlined in the lease agreement.

In many non-residential leases, Lee said the property taxes flow directly to the tenant.

In addition to the tax penalty reduction, city councillors approved a motion arising from Coun. Woolley to look at how they could help with tax deferrals for other business-types in the city. This would include hotels, gyms, night clubs and non-profits.