Small businesses in Montreal are getting a break on property taxes

Published November 9, 2018

The City of Montreal unveiled its upcoming budget on Nov. 8, revealing some well received news for small businesses. The property tax rate on the first $500,000 of a non-residential building’s evaluation will be cut by an average of 9.9 per cent in 2019.

While exact rates will vary by neighbourhood, small businesses across the city will experience a property tax reduction.

The average property tax reduction for buildings valued between $500,000 and $2.9 million will be 3.2 per cent. The average tax rate for properties valued between $2.9 million and $3.1 million will remain at the current level and properties valued between $3.1 million to $10 million will experience an average increase of 0.8 per cent, which is only half the raise being imposed on the residential sector. Buildings valued at more than $10 million will have a higher property tax rate — they will see an average increase of 1.8 per cent, on par with the consumer price index.

Across the board, the tax rates planned for 2019 will mean lower increases than implemented in recent years for non-residential properties of all sizes, which will provide welcomed relief for Montreal’s small businesses, especially since 57 per cent of non-residential building owners are expected to see the maximum decrease in their rates. Included among this cohort are many franchisees and independent restaurateurs. The reductions are expected to trickle down to rental agreements, which should also relieve inflationary pressures on leases.

Montrealers paid the highest non-residential property taxes in Canada in 2018. For industries with small profit margins, like foodservice, this was a major hurdle to doing business in the city. The new rates are part of a broader effort to reduce the gap between Montreal and municipalities across the rest of the country. Overall, non-residential tax rates will increase at a rate 25 per cent slower than residential properties from 2020 to 2023, according to the new budget projections.

As building owners still struggle with rising property values, the next step for the City of Montreal is to make sure buildings are properly evaluated. The reduced tax rates are great news, and Restaurants Canada hopes these are just the beginning of more positive developments to come over the next few years to make Montreal a more welcoming place for business.


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