Removal of the Provincial Property Tax from the Municipal Tax Bill
IT IS THEREFORE RESOLVED THAT Alberta Municipalities advocate for the Government of Alberta to assume direct responsibility for the collection of provincial education property taxes, thereby relieving municipalities of this obligation and ensuring a more transparent approach to education funding.
WHEREAS the Municipal Government Act and the Education Act mandate municipalities to collect education property taxes on behalf of the Government of Alberta;
WHEREAS the Government of Alberta is currently responsible for establishing the education property tax requisition, yet municipalities are tasked with its collection and remittance;
WHEREAS fluctuations in the education tax requisition can lead to misunderstandings among taxpayers regarding municipal tax increases, adversely affecting the perception of municipal accountability and transparency;
WHEREAS the role of municipalities as collection agents for the provincial government places the financial risk and burden of tax collection on local administrations, jeopardizing other fiscal priorities and service obligations;
WHEREAS municipalities bear the financial responsibility to remit education property taxes to the provincial government prior to the full collection, exposing municipalities to potential fiscal deficits;
WHEREAS K-12education is fundamentally a provincial responsibility, and it is imperative to ensure that education funding mechanisms are clearly aligned with the appropriate level of government for greater effectiveness and efficiency;
WHEREAS the Government of Alberta is increasing the amount of education taxes collected, from $2.7 billion in 2024-25 to $3.6 billion in 2027-28, representing a shift of the provincial tax burden onto Alberta property owners; and
WHEREAS municipalities across Alberta have been vigilant in observing the fiscal policies impacting their constituencies, particularly regarding education property taxes and there is a growing concern among municipalities over the increases experienced by residential and non-residential ratepayers.
BACKGROUND:
Local governments have long carried the responsibility of collecting provincial property taxes, resulting in a blurring of the distinction between municipal taxation responsibilities and provincial education funding obligations.
The current practice of integrating the provincial education property tax within municipal property tax notices leads to misconceptions by the public regarding the accountability and usage of property taxes. By separating the collection of municipal government and provincial government property taxes, both transparency and accountability would be significantly enhanced, fostering clearer delineation between municipal and provincial responsibilities.
Every year the province calculates the amount every municipality must collect from property owners to help fund the K-12 education system based on the municipal assessment data.
The Government of Alberta increased the education property taxes from $2.56 to $2.72 per $1,000 of equalized assessment for residential/farmland properties and from $3.76 to $4.00 per $1,000 of equalized assessment for non-residential properties in 2025-26.
The provincial education property tax requisition increased from $2.7 billion in 2024-25 to $3.1 billion in 2025-26, a 14.3% increase with further significant increases projected in 2026-27 and 2027-28. The increases are a result of the Government of Alberta’s new plan to have provincial property taxes cover 33% of Alberta Education’s operating costs compared to the 2024-25 level of 28.9% [1] Municipalities expect that this shift will be compounded with further increases to overall education spending.
Municipalities stress the need for a balanced approach that sustains educational advancements without disproportionately burdening local ratepayers.
Alberta Municipalities (ABmunis) has engaged in extensive advocacy for a more transparent tax regime. ABmunis has received many resolutions over the years to advocate for the province to assume direct responsibility for the collection of provincial education property taxes.
- In 2020, ABmunis’ members passed a resolution that called on the Government of Alberta to take on the responsibility of collecting the Education Property Tax on a provincial level.[2]
- In 2014, ABmunis’ members passed a resolution that called for the elimination of the provincial education property tax.[3]
- In 2011, ABmunis’ members passed a resolution that called for a review on the practice of collecting education taxes.[4]
With the adoption of these resolutions, municipalities have shown their concerns numerous times. Since these previous motions, some openness to the conversation has been signaled by the Premier. The Premier’s 2023 commitment, outlined in the mandate letter to the Minister of Municipal Affairs, to review the education property tax with a view of enabling municipalities to retain more funding for local priorities, represents an opportunity for the province to engage with municipalities on the various aspects of education property taxation.
At ABmunis 2024 Convention, Alberta Premier Danielle Smith asked for feedback from municipalities about the province possibly taking over tax collection from cities and towns and stated that it could be one way for the province to lighten the financial load for municipalities.
This motion is partially being made in acknowledgement of that openness to the discussion.
[1]ABmunis’ Preliminary Report on Alberta’s 2025 Budget
[2] ABmunis 2020 resolution: Education Property Tax Collection - https://www.abmunis.ca/advocacy-resources/resolutions-library/education-property-tax-collection
[3] ABmunis 2014 resolution: Provincial Responsibility for Education Property Tax Collection - https://www.abmunis.ca/resolution/provincial-responsibility-education-property-tax-collection
[4] ABmunis 2011 resolution: Removal of Educational Tax Requirement - https://www.abmunis.ca/resolution/removal-educational-tax-requirement
As noted in the background, ABmunis has a long history of advocating for a separation of responsibility in the notice and collection of provincial property taxes. Over the past decade, the Government of Alberta has given mixed reasons for declining to explore solutions. However, Premier Smith expressed interest in property taxes and Alberta’s approach to property tax collection during her address at ABmunis’ 2024 Convention. In general, this resolution aligns with ABmunis’ ongoing advocacy to improve municipal government finances and transparency in educating the public about what services and taxes are a municipal responsibility.
If this resolution is passed, it will be forwarded to the Government of Alberta for response. Further advocacy would be recommended to the ABmunis’ Board by the relevant policy committee(s) within the context of related priorities and positions.