Finances of the Nation: A Brief Look at the Role of Federal Payments in Lieu of Taxes in Municipal Finances

Jennifer Robson ()
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Jennifer Robson: Carleton University, Ottawa

Canadian Tax Journal, 2025, vol. 73, issue 2, 347-361

Abstract: One understudied aspect of intergovernmental fiscal arrangements is the system of payments in lieu of taxes (PILT) made to local tax authorities. In light of ongoing changes to the government of Canada's real property holdings, this article reviews published federal data on PILT transfers made in 2019 to 2023 for nine cities of interest, including both cities in the National Capital Region. The article also uses city-level published data, gathered from municipal budget and fiscal documents, to assess the importance of federal PILT transfers to these municipalities. The analysis shows that the fiscal impact of PILT payments varies substantially across cities, but concludes that the PILT program is a blunt instrument that is not well suited to addressing fiscal pressures at the municipal level.

Keywords: Property taxes; municipal finance; municipal taxation; intergovernmental; federalism (search for similar items in EconPapers)
Date: 2025
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DOI: 10.32721/ctj.2025.73.2.fn

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