Manitoba tax changes to help more people despite raising more money, premier says

WINNIPEG – Manitoba Premier Wab Kinew on Friday pushed for changes to the property tax that the opposition has criticized as a tax on the middle class.

Kinnew held a press conference in suburban Winnipeg to celebrate the tax change announced in last week's provincial budget.

About 83 per cent of homeowners will pay less under the new system, Kineau said, even though the tax change is expected to bring in an extra $148 million a year for the province.

“When we campaigned (last fall), we talked about the middle class because we want to make a difference for the average Manitoban,” Kenew told reporters.

“I know Manitobans have been tense for the last several years.”

The budget eliminates the 50 percent credit for residential education taxes and the $350 credit starting next year. The 10 percent discount on commercial properties has also been removed.

Under the new system, the government will provide a flat loan of $1,500 to homeowners. Owners of rental apartments, as well as owners of commercial real estate are not eligible for loans.

It's a change the government says will result in savings for owners of homes valued below $437,000, depending on the local school tax rate, and owners of homes valued above that level will pay more.

The break-even point is lower in school divisions such as Winnipeg and Seven Oaks, where the local millage rate is higher than the provincial average.

The opposition Progressive Conservatives said Kinnew's claim that 83 percent of homeowners would save money is incorrect because many homes in the suburb cost more than $437,000.

“We are not talking about the very rich here. We are talking about the middle class,” said Tory finance critic Obbie Khan.

City of Winnipeg data shows the city has tens of thousands of homes valued above the $437,000 threshold.

The government's estimate that 83 percent of homeowners will pay less under the new system is also based on a comparison between last year's refunds and next year's $1,500 flat credit on refunds, Finance Minister Adrien Sala's office said in a written statement Friday.

The Tories said the data was out of date because school tax and the 50 per cent refund were rising in many areas this year.

Kinew stood next to a $359,000 bungalow in the St. Vital neighborhood to make his remarks. The city's website shows several homes on the neighboring street costing more than $500,000.

Khan said the fact Kineu held a press conference to re-announce the budget measure shows the NDP government's enthusiasm for the tax change.

A political analyst says the tax change may not go over well in some suburban constituencies that swung from the Tories to the NDP in last year's provincial election.

“In many ways, the NDP was elected as a rejection of the previous administration and secondly because of concerns about issues like health care,” said Christopher Adams, an adjunct professor of political studies at the University of Manitoba.

“Right now the NDP is making those changes. They may be forgotten by the next election, but I think there will be a bit of a hit in some middle-class areas of Winnipeg.”

The NDP has made affordability a key theme of its time in office so far, which includes temporarily suspending the provincial fuel tax, which runs until the end of September.

Kinew said the property tax changes would make the system more progressive because people with lower value homes would pay less and people with more expensive homes would pay more.

He also said that due to the province's deficit, the government could not forgo more revenue.

“We are also addressing the legacy of structural deficits and chronic underfunding of education in Manitoba.”

This Canadian Press report was first published on April 12, 2024.

Steve Lambert, Canadian Press