How to Modernize a Property Tax System
A Canadian Roadmap
Making updates to a taxation system is among the most complex tasks a jurisdiction can undertake. More than a technical or legislative reform, the exercise is a political, administrative, and communications challenge to maintain public confidence in the system. Property tax represents the majority of revenue collected by local governments and is one of the highest operating costs paid by many property owners. It is the magnitude of stakeholders and revenues impacted by property taxation that makes the need for constant improvement essential.
Taxation systems which fail to modernize ultimately fail the stakeholders that rely on them, and across Canada, there are examples of ongoing work to improve the frameworks and produce fair, equitable, and accurate results, including:
- In Alberta, the Assessment Model Review is focused on updating the regulated assessment system to ensure fairer and more accurate valuations for regulated property types.
- The Saskatchewan Urban Municipalities Association has commissioned the International Property Tax Institute to conduct a comprehensive review of the province's property tax and assessment system.
- New Brunswick has officially embarked on a comprehensive overhaul of its property assessment and taxation systems. This includes soliciting public input and evaluating reform options to improve fairness, transparency, and stability.
- In Ontario, a review of the property assessment and taxation system has been launched, focused on enhancing fairness, affordability, and business competitiveness, as well as exploring modernized administrative tools, better municipal support, and enhanced data access.
Ontario’s now nine-year freeze on property values reveals just how hard it is to restart the engine once the revaluation process stalls. Experience shows that when governments approach reform deliberately and inclusively, they can deliver a system that is not only more equitable and up to date, but also more trusted.
Undertaking, and successfully completing, a tax system update is comprised of five key elements.
1. Laying the Groundwork: Recognize the Need and Build the Case
Modernization does not begin with issuing new assessments. It begins with building a shared recognition that the existing system is no longer serving its purpose. This requires a clear diagnosis of what is broken. Are valuations for certain property types (or perhaps, as in Ontario’s case, all properties) misaligned with current market realities? Is the lack of equity requirements in assessments, as is the case in New Brunswick, resulting in widespread unfairness? Are appeal volumes overwhelming local boards, pointing to systemic mistrust or inconsistencies? Are there concerns surrounding the transparency of the assessment process? Clarifying the issues is essential for establishing the need for reform.
Equally important is framing the purpose of modernization. It must be tied to clear, public-facing goals, such as restoring fairness between taxpayers, creating a more efficient appeals process, or improving predictability for both residents and businesses. Without this framing, modernization risks being perceived as a technocratic exercise—or worse, a pretext for increasing tax revenue. Therefore, governments must communicate early and often that modernization is a matter of fairness and equity, not revenue generation.
2. Stakeholder Engagement: Map, Consult, Repeat
Reform will only succeed if it reflects the perspectives of the people it affects, and that requires a strong stakeholder engagement strategy. To begin, governments must develop a comprehensive understanding of the stakeholders, such as municipal governments, homeowners, business and industry groups, and property tax professionals. Public information campaigns should be paired with accessible feedback mechanisms to ensure that information flows both ways. If assessment values reflect the market, then all market participants have a unique and valuable perspective which supports effective decision making. Engagement must be sustained throughout the process, not treated as a one-time event. Governments should commit to ongoing dialogue, updating stakeholders at key milestones, and reporting back on how their input has been incorporated—stakeholders should see evidence that their participation helped shape the direction and outcomes of the reform.
3. Adapting Best Practices: Scan, Pilot, Calibrate
Canadian jurisdictions don’t need to invent solutions from scratch. Many proven practices already exist, and there are numerous professional organizations with broad-scope expertise available to be leveraged. However, successful modernization requires a deliberate process of scanning what others have done and calibrating those solutions to local conditions. This includes benchmarking reassessment cycles to determine how frequently property values should be updated and examining tools that help smooth the tax impacts (such as phase-in or capping programs). It is important to understand the breadth of options, weighing each for legal feasibility, administrative cost, taxpayer impact, and overall equity. The goal is not blind adoption, but thoughtful adaptation, taking what works elsewhere and tailoring it to fit local realities.
4. Stability and Predictability: Design the Transition Carefully
Even when assessment updates are long overdue, the transition will need to be gradual and carefully managed. One tool is a “phase-in program”, which is currently provided for in Ontario legislation and has been recently implemented in both Montreal and Saskatoon. This phase-in program spreads any revaluation increase over the duration of the assessment cycle. Phase-ins give taxpayers time to adjust, which helps reduce political pushback. Clear, consistent messaging is also essential, particularly the point that a reassessment does not increase municipal revenue. Many assessing authorities in Canada regularly reinforce this point in public materials to prevent confusion.
Another critical step is conducting tax shift simulations before releasing new values. These analyses can identify where tax burdens are likely to rise or fall, by region, property type, or demographic group, and inform communication strategies and policy supports in advance. Ultimately, stability is as much about perception as it is about policy. Governments must proactively manage expectations so that a rise in assessed value is not misinterpreted as a tax hike.
5. Urgency and Institutional Discipline: Avoid Getting Stuck
One of the greatest challenges in modernizing a property tax system is maintaining momentum, particularly when political or economic disruptions arise. Once reassessments are delayed, it becomes significantly more difficult to restart them, both administratively and politically. To prevent this, reassessment cycles should be enshrined in legislation. Jurisdictions must also build assessment readiness into their regular budgeting processes to ensure that staff capacity, data systems, and operational planning remain intact—even between cycles. Establishing clear performance timelines and publicly visible milestones can further help hold governments accountable and prevent indefinite deferrals.
Ontario offers a cautionary example: repeated postponements have left the province using 2016 assessment values, creating widespread inequities. Properties whose value growth has outpaced the market continue to benefit from artificially low valuations, while those whose values have fallen or stagnated shoulder more than their fair share of the tax burden. Business leaders, municipal officials, and taxpayer advocates alike have urged the province to resume regular updates. Avoiding this kind of stagnation requires not only political will, but also durable institutional infrastructure that cannot be quietly dismantled or ignored.
Modernization as a Process, not a Switch
A modern property tax assessment system is not just one that is fair, current, and efficient; it’s one that has gotten there through a deliberate and credible process. Across Canada, governments have learned (sometimes the hard way) that public trust is just as important as technical accuracy.
Successful modernization hinges on five core principles:
- Make the case.
- Engage widely and meaningfully.
- Leverage proven practices.
- Manage the transition with predictability.
- Treat it as an obligation, not an option.
Whether in Alberta, Saskatchewan, New Brunswick, or Ontario, Canadian jurisdictions offer a wealth of practical lessons on how to get it right. Reform is not easy, but done well, it leaves behind a more trusted and resilient property tax system. It builds a stronger foundation for accountability, municipal sustainability, and public trust.
Scott Powell,
Director, Team Lead, Complex Property Tax
scott.powell@ryan.com