Local Journalism Initiative Reporter
The Region of Queens Municipality (RQM) council gave first reading to a new bylaw that would see its Deed Transfer Tax boosted from 1.00 per cent to 1.5 of the cost of the property, at its council meeting April 13.
For decades, the province has given municipalities the authority to charge a tax on the sale of a property known as a deed transfer tax. The tax is required to be paid at the time of registering a new title deed with the Nova Scotia Registry of Deeds.
Currently, at 1.00 per cent, the tax generates between $350,00 and $425,000 for the municipality per year. An extra half a percentage will generate an additional $150,000 in revenue in 2021-22, and potentially up to $200,000 in future fiscal years, according to staff calculations.
"This money goes into our operating accounts and helps us offset tax rate increases," said RQM Mayor Darlene Norman.
The proposed new bylaw will be advertised soon, giving an opportunity for residents to comment on the potential change prior to a second reading and submission to the Minister of Municipal Affairs. If it passes through all the steps, the new bylaw will come into force on June 1, 2021 at the earliest.
According to Norman, the tax increase will help cover the overall increase in costs and lessen the burden on the general taxpayer. Going with an increase in the transfer tax avoids tacking two or three cents per $100 of assessment rates on to property taxes, she said.
"If we raise the property tax we are affecting up to 11,000 people across our region. By raising the deed transfer tax, it's very specific to those people purchasing homes," said the mayor. "We want to support new home buyers but, then again, when we look at our stats regarding our poverty level and employment rates, we recognized that we have a large number of people who are struggling."
Norman conceded that people hate the word "tax," but she pointed out that government largely functions because of taxes and that when the price of goods and services go up the money to cover them has to be found from somewhere.
Originally the tax was set at 0.5 per cent when it was first instituted in the Region of Queens in 1998. It was increased to 1.00 per cent in 2010, to help cover the anticipated operating costs of Queens Place Emera Centre. A 1.5 per cent increase is the maximum that can be applied in Nova Scotia.
The tax does not apply in some circumstances, such as the inter-family transfer for a nominal sale price, or when a property is sold to a registered Canadian charitable organization.