Property tax
Property taxes are applied to both businesses and residences and are generally viewed by economists as good taxes because they are hard to evade (the property is immovable), the tax base cannot thus shift significantly because of the tax, and they are efficient in a traditional economic sense because they minimize distortion of resource allocations and economic behaviour. They are criticized, however, for being insufficient to fund municipal services, frequently unrelated to ability to pay and municipal benefits received, and for negative impacts on housing markets and patterns of land use and urban development. Their design usually contributes significantly to their effectiveness, with 4 key elements: which properties are taxed (and which exempt); how properties are assessed (commonly by area, by market value or some combination thereof) and who does the assessment; the tax rate, whether differential rates are applied, and who sets it; and administration of the system (see Slack and Bird, 2015).
In Canada, farm properties are taxed at a lower rate than other properties, often at a rate in theory that determines their value if continuing in farming rather than sold for urban development. Certain parts of a farm may be exempt from taxation, or their may be a tax rebate. However, there is sometimes criticism that the rates are not differentiated by the type of farm enterprise and its land base, which can have a significant impact on the costs of municipal services (cf. Dahlby et al., 2017).
Although proponents of the transition to sustainable food systems sometimes call for an additional property tax rebate in exchange for investments in sustainability, this is usually challenging for rural municipalities because the revenue shortfalls from property taxes are significant, especially when the municipality has misjudged the costs of servicing scattered residential development.
Land transfer taxes
Utilities taxes
Livestock tax
Lethbridge county AB has imposed (2016) a livestock head tax of first $3, now $2.50/head, primarily on cattle feedlots, to help cover the costs of heavy vehicle transport on roads and bridges. The initiative is to raise $3.5 million over 35 years. Contested, it was deemed legal by the Alberta Court of Appeal, but appeals to higher courts could continue. Some have argued that more equitable approach is to reconfigure property assessments, or to impose road user fees (Dahlby et al., 2017).
