Many Manitoba farmers are bracing themselves for another property tax hike. Despite a recent reduction in the portioned assessment on farmland that is subject to taxation, reassessments on farm properties across the province are on the rise. Manitoba farmers are no strangers to the crucible of natural disasters and unstable commodity markets. These are the risks borne by the Manitoba farmer. But who in the business would have anticipated the exacting cost of property taxes on farms.

A recent study conducted by the Canadian Taxpayers Federation (CTF) found that between 1993 and 2002, school division taxes in Manitoba rural municipalities increased 7.11% per year. That's more than triple the average annual rate of inflation. Property taxes on Manitoba farmlands are broken down by municipal taxes paid to local government and school division taxes paid to local school boards. The provincial education support levy is charged on farm residences but not farmlands. In 2004, rural municipalities across the province collected $147 million in school division taxes.

Properties classified as farmland within rural municipalities alone are paying 32% of the costs to finance Manitoba school divisions and 37.2% to support municipal government. The rural municipalities that have a low ratio of farmland to other property classes water down these figures. But in some municipalities, the school division taxes on farmland are remarkably high.

In the R.M. of Cameron, school division taxes levied on farmland account for 86% of the total school division taxes. The school tax burden only compounds the latest problems of flooding, low commodity prices, and unfair international farm subsidies. The only difference between these four curses is that the
provincial government is in a position to do something about the grossly unfair property tax burden.

The province's speech from the throne has finally offered some much needed relief to Manitoba's rural communities with a 33% reduction in school taxes on farmland, and an additional 17% reduction in 2005 but there is still 50% more to go.
The lopsided property tax burden on farmland is rooted in the structure of the property tax system itself that discriminates against businesses (farms) whose mode of operation depends on a large property base. The property tax system has shown itself to be profit-insensitive.

The CTF recommends the province act on the following as a means to alleviate the property tax burden for our farmers:

• The province should extend the scope of the of the Taxpayer Protection Act to municipalities
  and school boards so that all school and municipal tax increases must first be passed by voter approval through referendum.
  
  
• To remedy the burden of unaffordable and profit-insensitive school taxes, the CTF is calling for the elimination of school division taxes levied on farmland.
  
  
• To benefit all tax paying property owners in Manitoba, the CTF recommends that the province and school divisions freeze school taxes and work toward annual school tax reductions.
  
  
• Due to year after year increases of school division taxes, the province should explore alternative funding mechanisms, including a property tax cap (annual increases limited to the rate of inflation) and relevance of school boards.

Manitobans should not be treated like a cash cow. School boards will have to stretch their current dollars farther and the province will have to arrive at a new funding formula to ensure standard education needs are satisfied.