Posted at 12:00 p.m
Tax car trips? Vacant apartments? Paved parking lots? Montreal is considering new solutions to fund its next budget, according to a document released on Wednesday.
The city is discussing eco-tax and social tax measures and exploring the possibility of reducing the frequency of garbage collection or the snow load. It needs to close the currently targeted gap of 200 million between projected spending and revenue for 2024.
These ideas will be put to civil society for a consultation that will open at the end of the month. “The aim is to find structuring and lasting solutions that allow the metropolis to adequately finance its activities and better meet the needs of the population,” states the President of the Executive Committee of Valérie Plante, Dominique Ollivier, in the introduction .
Property taxes, which are the city’s main source of income, no longer allow it to adequately meet its growing expenses and obligations.
Dominique Oliver, President of the Executive Committee
Some scenarios the administration wants to hear from citizens about:
- A tax on every kilometer driven behind the wheel of a vehicle to replace the current tax on petrol, which electric vehicles are making increasingly obsolete.
- A tax on vacant homes to encourage landlords to lower their rent to find buyers. Vancouver, Toronto and Ottawa have all implemented some version of this measure in recent years.
- A tax on impervious surfaces – especially parking lots – that return rain and snow water to the city’s sewage system. “Such an eco-fiscal measure could, for example, make it possible to finance certain infrastructures to improve wastewater management. »
- Parking meters whose price changes according to demand. A pilot is already planned downtown this year, the document said: The hourly rate will increase from $4 to $5 on weekday afternoons.
- Royalties for the construction of new housing to fund the new municipal services required for their delivery. Currently it is “all Montrealers who have to bear these costs”.
The modalities of these scenarios are not specified and are also part of the consultation. It is not known whether a possible mileage tax would apply to all vehicles or whether a possible impervious surface tax would only affect large car parks, for example.
On Wednesday, the Plante administration declined to comment further on the content of its consultation document.
“Really on the cutting edge”
Experts say Montreal is far from the only local government to bet on green taxes — taxing harmful behavior with the goal of preventing it — to kill two birds with one stone: protect the environment and save the coffers.
“It’s really cutting edge,” said Justin Leroux, professor of economics at HEC Montreal.
It helps change behavior and generate revenue that can then be used to improve infrastructure or reduce taxes elsewhere.
Justin Leroux, economics professor at HEC Montreal
In addition to environmental goals (hence the “eco” in the name), the concept can also be applied to taxes that discourage other behaviors, such as leaving a home empty, explained Leroux. “It’s really the idea of changing behavior through a price signal,” he said.
Jean-Philippe Meloche, professor of urban economics at the University of Montreal, believes that Quebec is “socially behind” other societies when it comes to green taxes: “We have a carbon tax, but it’s very weak. We have a fuel tax, but it’s very low. We have a very watered down application of the eco-tax. »
In his opinion, however, local governments should not be held accountable like municipalities. Some of these measures – notably a kilometer tax – are difficult to apply on a small scale.
Reduction of benefits in sight?
In addition to considering the introduction of new tax breaks, the administration’s pre-budget consultation document also mentions a potential spending cut by the City of Montreal.
“Are there any activities where the city should or could be asked to review the level of certain services? asks Montreal in the document.
“It would be a matter of frequency [de l’enlèvement des ordures], e.g. B. weekly or biweekly, continues the document. In addition, snow load work is carried out today from 8 to 10 cm of snowfall. It would be good to ask if these standards could be reviewed to generate savings without compromising the quality of service. »
The possibility of delegating certain tasks to the segregated cities or of assigning other levels of government directly to take over certain services should also be part of the considerations.