Agenda Index City of Vancouver



Vancouver City Council


Director of Finance


2001 Property Tax Land Averaging




Council policy is to keep property taxes affordable by following a practice of holding year-over-year tax increases at inflationary levels. Council has used three-year averaged land values in the calculation of property taxes for Class 1 and Class 6 in each year since 1993.


This report recommends that the Assessment Commissioner be notified that Council isconsidering the use of land averaging/phasing as potential taxation options for 2001. This notification does not commit Council to the implementation of either option. Detailed statistical modelling of the impacts of various taxation options will be reported to Council in the new year.


Since 1989, Vancouver City Council has taken proactive measures to address the tax shifts within property classes that have resulted from uneven year-over-year assessment increases. These measures have in various years taken the form of: (i) a cap on each property's year-over-year increase in taxable land value (1989 only), (ii) a cap on each property's year-over-year tax increase (referred to as "tax capping"), and (iii) the use of a three-year average of taxable land value in property tax calculations ("averaging").

All interventions to the market-based taxation system are revenue-neutral within each property class. This means that while the taxes paid by an individual property may differ depending upon whether a mitigation measure is used, the overall levy paid by a class of property remains the same, whether or not that mitigation measure is used. When an individual property's tax is lowered in a given year due to an intervention to the market-based system, there are other properties in the same class for which taxes will increase as a result.

Mitigation measures have been applied to the residential and/or business class in every taxation year since 1989. Three-year land averaging was approved by the Provincial Government as a taxation option in 1992 for use in subsequent taxation years. Council has approved the use of three-year land value averaging as a taxation option for residential and business properties in each year since 1993.

Statistical modelling has shown that land phasing has not been as effective in lowering the share of properties that experience extreme tax increases as averaging has been. Although there are strong arguments for applying land value averaging on an ongoing basis, provincial legislation requires Council to approve averaging on a year-by-year basis, and notify the Assessment Commissioner annually of their intent to use averaging.


This report directs staff to notify the Assessment Commissioner of Council's intent to use land averaging and/or land phasing in the coming year. This notification gives Council the authority to apply land averaging or land phasing in 2001, but does not commit them to doing so in any way. Once the Consolidated Roll is available, staff will report back on the impacts of the various 2001 taxation options.

* * * * *


Comments or questions? You can send us email.
[City Homepage] [Get In Touch]

(c) 1998 City of Vancouver