Montreal mayor calls for municipal tax reform, Quebec premier says no

Quebec's CAQ government is closing the door on Montreal Mayor Valérie Plante's demands for tax reform that would benefit municipalities.

It's up to the mayors to "manage their municipalities well," said Minister of Municipal Affairs Andrée Laforest on Thursday. Her statement was greeted by boos at a meeting of elected municipal officials in Montreal.

At a news conference on Thursday in Saguenay before going to meet his elected representatives gathered in caucus, CAQ Premier François Legault said his government has "no room to manoeuvre" and that it has already signed a "very advantageous" fiscal pact with the municipalities until December 2024.

Laforest added that municipalities already have all the powers to diversify their revenues, and some are already doing so.

"Now, many municipalities are not using this right to diversify, so it is also up to them to manage their municipalities well," she told a press scrum before heading off to the caucus meeting at a hotel in Saguenay.

Gathered in Montreal for a summit on taxation, municipal councillors from Quebec's major cities did not take the minister's remarks well.

In excerpts circulated on social networks, boos were heard in the room when the moderator of a panel read out the statement.

Laforest refused to suggest that cities should increase the tax burden on residents.

"There are many ways of working with citizens in the municipalities," she added, without elaborating.

The minister pointed out that through the Fiscal Pact, her government had agreed to a direct transfer of $7.5 billion to the municipalities.

"However, we will listen to the municipalities," she added.

Later on Thursday, she was due to meet the mayors of Quebec's major cities in Montreal to discuss municipal taxation.

Finance Minister Eric Girard said that his colleague, Laforest, would lead the negotiations with the cities but that the fiscal pact expired at the end of 2023. He did not seem to be open to adding money to the envelope.

"I understand that conditions are extremely difficult for everyone," he said.

Plante argues that property tax is an outdated model that is no longer sufficient to meet the needs and responsibilities of municipalities.

Legault argued that "everywhere in the world," fiscal responsibilities are shared in the same way: taxes for the government and property taxes for the municipalities.

However, he pointed out that property taxes are lower in Quebec than in Ontario, while taxes are higher in Quebec than in Ontario.

He has raised this comparison before without going so far as to suggest that municipalities raise property taxes.

This report by The Canadian Press was first published in French on Sept. 7, 2023.