PEI

P.E.I. finance minister says no to calls for further delays in property tax payments 

Liberal finance critic Heath MacDonald is calling on the province to defer property tax bills beyond Dec. 31, but P.E.I.’s finance minister says she’s not budging. 

‘There is money in Islanders' pockets and paying your property tax is definitely a priority’

Finance Minister Darlene Compton says paying property taxes is a responsibility of all Islanders and she’s not prepared to extend the deferral any longer. (Kirk Pennell/CBC)

Liberal finance critic Heath MacDonald is calling on the province to defer property tax bills beyond Dec. 31 — but P.E.I.'s finance minister says she's not budging. 

MacDonald says deferring property tax bills until the end of the year — in the middle of the second wave of COVID-19 and during the Christmas holidays — is of little comfort to many people who will be struggling to get through the winter.

"There is a lot of uncertainty still within the economy and I think people are worried about the bills piling up, the Visas piling up," he said.

"There comes a point in time where there's a breaking point."

In April 2020, weeks after the pandemic began, the P.E.I. government announced a series of measures to help Islanders weather the economic impact.

'Islanders are expected to pay their taxes'

One of those measures was deferring property tax payments until Dec. 31, which means those payments are now coming due. 

Liberal finance critic Heath MacDonald is calling on the province to defer property tax bills beyond Dec. 31. (Wayne Thibodeau/CBC )

Other measures included:

  • Extending property assessment appeal deadlines for assessment year 2020 to Dec. 31, 2020.

  • Providing interest relief for the tax year 2020, including all past-due amounts.

  • Suspending tax-sale processes for the remainder of 2020.

Finance Minister Darlene Compton said paying property taxes is a responsibility of all Islanders and she's not prepared to extend the deferral. She said property tax represents about 11 per cent of the province's revenue and that money is needed for the province to deliver programs like health and education. 

"Islanders are expected to pay their taxes as of Dec. 31," Compton said in an interview with CBC News.

"There have been a number of programs for Islanders, whether they are provincial or federal, to help them through the pandemic with their income. I've talked to a number of banks, savings accounts are higher than they've ever been, so there is money in Islander's pockets and paying your property tax is definitely a priority." 

MacDonald is also raising concerns about the interest rate on overdue accounts.

'It is an astronomical amount'

The interest rate is 1.5 per cent, which works out to 18 per cent annually.

The province says about 60 per cent of Islanders have come up with the money and paid at least a portion of their residential property taxes as of Nov. 31, even though the bills were not due until Dec. 31. (Peter Scobie/CBC)

"Governments right now are borrowing money at a very low interest rate, one-and-a-half, two per cent, the interest rate on their debt is only one-and-a-half, two per cent. These are all-time low interest rates and when you look at the property tax on overdue accounts at 18 per cent… it's significant," said MacDonald.

"I think government should reconsider… it is an astronomical amount."   

Compton said she's not prepared to lower the interest rates on overdue accounts. 

"It shows the priority that should be placed on paying your property tax."  

The finance minister said anybody struggling to make their property tax payments should reach out to her department. 

The province said about 60 per cent of Islanders have paid at least a portion of their residential property taxes as of Nov. 30, even though the bills were not due until Dec. 31. 

'Kicking people when they're down'

About 51 per cent of commercial property owners have made at least a partial payment on their property taxes. 

Michele Beaton, the Official Opposition finance critic, first raised the issue of property taxes this spring. She says measures like deferring property tax bills are simply delaying the impact of COVID-19 on many families. (PEI legislature )

Michele Beaton, the Official Opposition finance critic, said measures like deferring property tax bills are simply delaying the impact of COVID-19 on many families. 

"Recovery from COVID needs a plan, an economic recovery plan. That has not been provided," Beaton said in a statement. 

"Unfortunately, the full extent will likely come at a time when there aren't a multitude of programs to help Islanders."

Beaton would like to see the province not charge the 18 per cent interest on accounts in arrears and write off the tax owed entirely for those who still don't have their jobs back.

"For people whose jobs haven't returned, how will government expect them to pay? Demanding payment from those still unemployed at the end of the year seems like kicking people when they're down," said Beaton.

More from CBC P.E.I.

ABOUT THE AUTHOR

Wayne Thibodeau

Prince Edward Island

Wayne Thibodeau is a reporter/editor with CBC Prince Edward Island. He has worked as a reporter, editor, photographer and video journalist in print, digital and TV for more than 20 years. He can be reached at Wayne.Thibodeau@CBC.ca

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