Dig Deeper: HRM report recommends sizable tax hike

A new pre-budget report to Halifax Regional Council is recommending an 8 per cent tax hike for both home and business owners in the city, as officials deal with rising costs and falling revenues.

The report paints a somewhat gloomy picture of the city's current finances, noting the Halifax Regional Municipality (HRM) is facing “significant economic headwinds," including inflation at "levels not seen since amalgamation.”

The municipality’s once strong financial position is showing "signs of erosion," it warns.

The proposed increase works out to about $173 a year for the average homeowner, or about $14 a month.

Businesses, though, would pay almost $4,000 more every year, or roughly $330 a month.

Along with increased costs, labour shortages are also proving to be expensive for HRM, resulting in staff shortages, and service reductions, including transit, which indefinitely suspended a number of routes Monday.

"We're really busy here, so it's a great time for council to put through these things that might go unnoticed by us," said café owner Lara Cusson.

"Some businesses have not made it through this pandemic, and some are very close to not making it now," she said.

"I think we really need to support small business in keeping jobs, employment elevated during this post-COVID economy," said Cusson.

Along with the inflation the whole world is dealing with, Halifax Water rates will increase by 3.6 per cent next month and the same percentage again in April.

The province has limited Nova Scotia Power's rate hikes to 1.8 per cent for the next couple of years, but rising fuel costs could push it higher.

Advocates note all of the hikes are coming from the same taxpayer.

"You know, if you want to spend 8 per cent more this year than last year, you can't just get money out of thin air," said Jay Goldberg, the interim Atlantic director of the Canadian Taxpayer's Federation.

“This is what the government's try to do: they're trying to take hundreds of extra dollars out of the people's pockets so that they can meet a bloated budget," said Goldberg.

The city also expects to collect a lot less in deed transfer taxes, as the housing market cools with rising interest rates.

The overall impact is hard to gauge.

"Of course, those who have to buy and have to sell will do so, but we're feeling a little bit of hesitancy from our clients out there to make a move as they try to figure out what the markets going to do and changes like that probably would add a little bit to that," said Marc Doucet, area manager for Royal LePage Atlantic.

By way of contrast, Moncton City Council recently voted to give its homeowners a tax break for 2023, with the mayor quoted as saying, “We know that we’ve had incredible growth in our community right now and assessments have really risen, so it was very important to us that our residential taxpayers did not receive a huge, huge tax bill.”

In Halifax, a spokesperson in the mayor's office told CTV News Mike Savage would not comment on the report prior to scheduled council meetings Tuesday.

She also noted the report was preliminary.

"The budget process belongs to council and an approved budget, whatever its eventual tax implications, is at least a few months out," the spokesperson said.