CANADA, May 31 - FREDERICTON (GNB) – The provincial government has introduced legislative amendments that would establish a new heavy industrial classification of property and permit local governments and rural districts to levy a corresponding local property tax rate.

The amendments to the Assessment Act and An Act Respecting Local Governance Reform, if approved, would take effect for the 2023 property taxation year.

“Over the past several years, and again during local governance reform engagement, government heard from stakeholders that consideration should be given to establishing additional categories or classifications of property, including industrial properties,” said Finance and Treasury Board Minister Ernie Steeves. “This will provide increased financial flexibility to local governments and rural districts, particularly with respect to the taxation of non-residential properties.”

With these changes, local governments and rural districts would have the option to set a local property tax rate on heavy industrial properties at a limited range of 1.4 to 1.7 times the residential rate. This rate could differ from that for other non-residential properties. The current local non-residential tax rate is 1.5 times the residential rate.

“We are starting on the road to comprehensive tax reform now,” said Local Government and Local Governance Reform Minister Daniel Allain. “We approached property tax reform in two phases. Phase 1 is outlined in our white paper. We have started moving on Phase 2 with the reduction of provincial property tax rates and, today, with a new classification for heavy industry. This empowers local governments, and we are responding to requests and commitments to do so.”

The owners of all potentially affected properties will be notified in a letter from the government.

Local governments will communicate any changes to property tax rates in the fall of 2022 as part of their 2023 budgeting process.