Yes, Windsor's property tax rate is high — but that doesn't mean we pay more

Windsor has one of the highest property tax rates in the province.

That's according to a new list from real estate website Zoocasa, which ranked 35 Ontario municipalities. With a property tax rate of 0.61 per cent, Toronto ranked as the city with the lowest property tax rate, while Windsor's rate of 1.78 per cent placed it dead last.

Those numbers may sound like Windsorites are getting fleeced — but that's not exactly the case.

How does property tax work?

Every year, the city determines how much money it needs to maintain public services like police, fire, roads, sewers, as well as fund new projects it wants to build. Then, based on the value of properties, a rate is determined to raise those funds.

The difference in that rate between Windsor and Toronto is a staggering 1.17 per cent, but when you factor in property values, the tables begin to turn.

For tax purposes, property values aren't derived solely from what you paid for your house; it's a calculation made by the Municipal Property Assessment Corporation (MPAC), an independent agency funded by municipalities and regulated by the provincial government.

Every four years, the MPAC updates what it believes is the value of every property in Ontario.

In Windsor, the MPAC says the average residential property is worth $164,000.

In Toronto, it's $770,000.

So when you apply these values to each city's tax rate, an average Windsor homeowner would pay just over $2,900 per year, while an average Torontonian would pay nearly $4,700 per year.

Joe Mancina, Windsor's chief financial officer, says comparing cities by property tax rates alone is "misleading." 

"You really need to consider the property tax rates as well as the assessment values," he said. "In municipalities that have higher assessment values ... naturally, the tax rate is going to be set at a lower level."

Mancina says that Windsorites actually pay lower residential property taxes on average than other large Ontario cities.

What happens when assessment values go up?

While the MPAC is set to send out new assessments across the province in 2020 — and property values in Windsor have certainly increased — that doesn't necessarily mean your taxes will go up.

"If all of the properties go up similarly, then what would happen is we would need to look at our tax rate — and in fact the tax rate could be lowered," Mancina said. "You're part of a pie ... if everyone went up by the very exact same amount, then one would expect that their property taxes would be about the same as what they were before."

Basically, the only way your taxes increase is if your assessment value increases by more than the city average — or if city council decides they need to increase their overall budget.