Farmland to be included in Manitoba's education property tax phase-out

The Manitoba government’s pledge to begin eliminating its education tax on property in 2021 includes farmland, according to a spokesperson for Finance Minister Scott Fielding.

The phased elimination of school taxes on property starting next year was mentioned, without any details, in the Progressive Conservatives’ throne speech earlier this month.

“Given the challenges we face…Manitobans need more tax relief sooner, not later, and your government will provide it. The phased elimination of the education property tax, paid by individual Manitobans, will begin next year,” said the text read by Manitoba’s Lieutenant Governor Janice Filmon.

The finance minister’s office has since confirmed the phase-out will apply to farmland, and incorporated farms will be eligible, clarifying some questions that were raised by farmers based on the wording in the throne speech.

Farm groups in the province, including Keystone Agricultural Producers, have been lobbying the provincial government to eliminate or reduce the education tax burden on farmers for several decades.

The school tax issue has intensified in recent years, as the amount of education tax paid by Manitoba farmers has escalated significantly — as much as $30/acre from one year to the next in some cases — as farmland values have appreciated over the last decade. In some cases, residential and commercial property owners have seen their tax bills drop, as school board revenues have been offset by rising farmland assessments.

The phase-out will begin sooner than was expected, as Premier Brian Pallister had promised to start eliminating the education tax on property by 2023 while on the campaign trail leading up to the 2019 provincial election. At that time, he talked about a minimum 10 per cent decrease annually.

Fielding’s office says further details on how the phase-out will work, including the province’s plan to address the impact on school tax revenue, will be announced at a later date.

It’s also not clear at this time how the province plans to handle the farmland school tax rebate, as agricultural landowners are currently eligible for a rebate of 80 per cent up to a maximum of $5,000. The rebate was introduced in 2004, at a rate of 33 per cent, in response to concerns about farmers carrying a disproportionate amount of the school tax burden.

Related: Manitoba Farmers Pushing for Tax Reform as Farmland Taxes Spike

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