Property tax policy is drawing renewed debate in cities across Canada, as municipalities weigh how much of the tax burden should fall on homeowners versus businesses, and as mayoral candidates in Toronto stake out competing promises on how fast bills should rise.
In Saskatoon, city hall is preparing to ask residents directly how they think the tax load should be divided. Starting in October, the city will run an online survey, with printed copies also available, asking for input on the ratio that determines what share of property tax is paid by homeowners versus commercial and other non-residential property owners. Currently, non-residential properties in Saskatoon pay $1.71 in tax for every $1 paid by a residential property of equal assessed value. Under that split, homeowners are expected to cover more than two-thirds of the $356.8 million in property tax the city plans to collect this year, with non-residential properties responsible for just under a third.
Why the Ratio Keeps Resurfacing
Coun. Randy Donauer, who pushed for the public engagement process, said the issue has repeatedly come up during city budget talks without resolution. “It’s not gonna be a fun conversation,” he said, adding that “neither side is going to be completely happy and council will be left with a tough decision.” The debate is not new: in 2023, then-councillor Mairin Loewen tried unsuccessfully to shift more of the burden onto businesses and away from homeowners.
Keith Moen, executive director of the North Saskatoon Business Association, welcomed the review but cautioned against relying too heavily on an open survey, saying it could produce “fairly biased and predictable results.” He argued that smaller cities like Saskatoon need lower commercial tax ratios to remain competitive, since larger centres can offset higher business taxes with bigger workforces and amenities. City hall data cited in the debate shows Saskatoon’s 1.71 ratio is lower than Calgary’s 4.63, Edmonton’s 3.26, Vancouver’s 3.53 and Surrey’s 2.54, but higher than Regina’s 1.61 and Winnipeg’s 1.44.
A separate report from the Canadian Federation of Independent Business (CFIB) ranked Saskatoon second among 66 municipalities nationally for supporting small business growth, placing second for cost burden, fourth for regulatory burden and eighth for overall small-business friendliness. Regina ranked 12th overall.
Atlantic Canada’s Wider Gap
The commercial-residential divide is far more pronounced in Atlantic Canada, according to a separate CFIB analysis of 80 municipalities across the four provinces. The report found commercial properties there routinely face municipal tax rates far higher than residential properties of equal assessed value, with Nova Scotia showing the largest average gap, at 146% higher for commercial properties. Prince Edward Island followed at 142%, New Brunswick at 67% and Newfoundland and Labrador at 55%. In Newfoundland and Labrador, once municipal business taxes tied to property assessment are factored in, the effective multiplier rises from 1.55 to 3.20.
Frédéric Gionet, CFIB’s Atlantic director, said the pattern amounts to “a tax penalty on doing business,” noting two properties of identical value using similar municipal services can face very different bills solely because one houses a business. The CFIB found the burden falls hardest on the smallest firms: among businesses with fewer than five employees, 31% said property tax eats up more than 10% of operating costs, and 40% said it has significantly hurt profitability. Among businesses reporting negative effects, 21% delayed or cancelled an investment, 20% delayed or cancelled an expansion, and 18% cut staffing or hours. CFIB is calling on municipalities to reduce and eventually eliminate the higher commercial rates, arguing a more balanced structure could spread the same total levy differently without necessarily reducing municipal revenue.
Toronto’s Election-Year Tax Pledges
While the residential-commercial split dominates debate in the Prairies and Atlantic Canada, Toronto’s mayoral race has centred on the overall pace of property tax increases. Mayor Olivia Chow’s campaign has pledged to keep future tax hikes “at or around” the inflation rate if she is re-elected, according to spokesperson Shirven Rezvany, who pointed to a nearly $2-billion budget shortfall Chow inherited in 2023. Since then, Toronto has seen a 9.5% tax increase — the largest since amalgamation — followed by a 6.9% hike in 2025 and a 2.2% increase this year, which came in slightly below inflation.
Rival candidate Brad Bradford’s campaign said Chow failed to honour her earlier promise of “modest” increases, arguing “voters have every reason not to take her word for it this time either,” while saying Bradford’s own tax plan would be announced later. Candidate Chris Alexander dismissed Chow’s inflation pledge as a “flimsy campaign promise” and said he would freeze property taxes in his first year if elected, followed by increases below inflation in year two, arguing that “property taxes have been sky-rocketing, while new housing goes unbuilt and services continue to disappoint.”
Taken together, the disputes in Saskatoon, Atlantic Canada and Toronto illustrate how property tax policy remains a persistent flashpoint for municipalities balancing service funding against competing pressures from homeowners and business owners alike.
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