Personal Taxes: Affordable and Competitive
Winnipeg and Manitoba are viewed as competitive in terms of personal taxes against cost of living. This is reflected in our affordable cost of housing and general cost-of-living expenses. The Government of Canada has a goods and services tax (GST), whereby individuals, businesses and other entities pay five per cent on most goods and services procured.
In Manitoba, an eight per cent retail sales tax (RST) is also levied on most goods and certain services. The RST is calculated on the selling price before GST is applied. Most businesses, including manufacturers and processors, qualify for full input tax credits on the amount of GST paid on purchases made for business purposes where the firm is not the final consumer.
There is also a GST credit for low-income households. The amount of this credit depends on a number of factors, including household income, number of dependent children, marital status, etc.
The City of Winnipeg derives the majority of its revenue through property taxes, with a small portion coming from a municipal business tax and user fees. Property taxes are calculated by applying municipal and school mill rates against the portioned assessment of an individual’s property. By definition, a mill is a one-thousandth part. For calculating taxes, one mill represents one dollar of taxes for every $1,000 of portioned assessment.
Personal Tax Example
|Portioned Assessment x||Municipal Mill Rate
|= Municipal Taxes|
|Portioned Assessment x||Provincial Education Mill Rate
= Provincial Education Taxes
|Portioned Assessment x||School Division Mill Rate
= School Division Taxes
|+ Local Improvements|
|= Total Current Taxes (Gross)|
Businesses and Business Improvement Zones: Tax Levy Rates
The business tax rate in Winnipeg is 5.3 per cent in 2016. Business taxes are calculated by applying a tax levy rate against the annual rental value. If applicable, a business improvement zone (BIZ) levy is also applied against the annual rental value.
Business Tax Example
Annual Rental Value x Tax Rate (Set by City Council) = Applicable Business Tax
Note: the applicable BIZ levy is calculated by applying the annual rental value multiplied by the BIZ levy rate.