Members of the education finance coalition, representing some 250,000 Manitobans, were led to believe some major education property tax relief would be included in the provincial budget. But the measures announced in the April 4 budget only exacerbate an already badly-flawed system.
Education finance coalition members (go to letspayfair.com for more information) strongly believe that the current method of funding education on the backs of property owners is not sustainable.
The coalition’s letter
Dear Premier Doer:
Recently you unveiled a provincial budget that you will take to the polls this year.
As a taxpayer I can tell you that it is woefully inadequate. Property owners have been asking you for years to make meaningful changes to education funding. But I know that your budget plans will not make any difference to my tax bill over the long run.
I know that this government has the capacity with existing revenues to eliminate the education tax on property over the next four to five years. The rebate after rebate system is not the solution and does nothing to alleviate the pressure on seniors and low-income people.
When you put in short term measures you are acknowledging that the current method of funding our children’s education is not working, but your solution doesn’t work either. I have had a chance to consider some of things I’ve heard you say about education taxes recently and I’d like to respond.
1.You have said: In the provincial budget, the Manitoba government will increase funding for education from general revenues from the current contribution of 71 per cent to 80 per cent.
Actually, what I know is that: To get that 80 per cent figure, you have bundled several things together like the costs for building schools, contributing to teacher pension funds and tax credits. So if you have to build a new school in a new area of the city, it can look like you’ve increased education funding but it has not taken any pressure off my property tax bill. As the Winnipeg Free Press said the day after the budget: “It sounds impressive, but any relief Manitoba property owners feel will be small and short-lived.”
2. You have said: You have eliminated the education support levy (ESL) on property tax for a saving of $100 million.
Actually: You didn’t eliminate it on all property. It was only removed from residential property, not commercial property. Even at that, the ESL has been more than made up for by increases in the special education levy.
3. You have said: You have increased the Education Property Tax Credit, saving Manitobans millions over the years.
Actually: A number of homeowners have seen their education taxes go up in the last eight years far higher than the additional tax credit could ever pay for. They have not saved any money. There would be no need for any property tax credit if the province eliminated education taxes altogether over a period of time.
4. You have said: You have increased the Seniors Property Tax Credit.
Actually: Despite this increase, many seniors know that school taxes on their homes are unfair and they should be eliminated. Increasing credits such as this one for one segment of society is an admission that school taxes are too high.
5. You have said: You have reduced the overall tax burden on Manitoba farmers by reducing the portioning on farmland.
Actually: Education taxes are still a hot-button issue for farm families, despite the tax rebate. Even though portioning is going down, assessments are going up and school boards consistently ask for increases – which is eroding any savings that farmers might see. Farmers know that this rebate is just a band-aid solution and want government to address the real problem, which is the outdated and unfair property tax based system.
6. You have said: To date your efforts have reduced education taxes on the average $125,000 home by eight per cent.
Actually: The 1999-2000 school tax revenue was around $600 million and is now $746 million — a 27 per cent increase. The eight per cent savings have been more than absorbed by school board decisions.
7. You have said: The Manitoba Government has shown an ongoing commitment to sustainable tax reductions and is not interested increasing the overall tax burden on Manitobans.
Actually: Manitoba school boards — an arm of the Manitoba Government — have in fact increased taxes significantly to pay for a provincial government core service. A Manitoba homeowner or business owner need only look at his or her property tax bill to know that the taxes they pay for provincial services have gone up and up.
8. You have said: Alberta, Saskatchewan and Ontario all report property taxes as a percentage of school funding at higher rates than Manitoba.
Actually: To use a percentage is misleading, especially when we know that places like Alberta and
Ontario have much higher property values and a significantly larger assessment base to work with. So let’s look at real dollars. For a straight comparison using the same assessed value for a home assessed at $125,000 for 2006, the school taxes are as follows:
• Toronto $330
• Calgary $600
• Saskatoon $1,051
• Montreal $418
• Winnipeg $1,531
• A West Vancouver home assessed at $1,125,930 has school taxes of $1,913.
Thank you very much for hearing my concerns and please know that I would like to see education paid for in a more equitable way.