Why does the property tax rate go up every year in Langley City?

Every year, the property tax rate goes up. Some might wonder why this is the case and why the income and sales tax rates stay constant.

With income tax, as people's overall incomes increase or decrease, so does the amount of money the provincial and federal governments collect. The same thing happens for sales tax. This change is due to the formula "income/cost of good" * "tax rate".

For property tax, it is different. Local governments, such as Langley City, set their annual budget, and then they collect the property tax required to balance the budget. Local governments cannot run a deficit budget

The formula is more complex. 'total property tax required to balance budget' / 'total value of all properties'. This formula gets you the mill rate. The property tax you pay uses the formula 'your property value' * 'mill rate'. I've simplified these formulas and written more details about calculating property tax in a different post.

Local government's significant costs are workers' salaries and purchasing goods and services. Salaries increase, as does the cost of goods and services, making local governments such as Langley City subject to inflation.

Over the years, the cost of providing some services has increased faster than the inflation rate. Policing is our number one cost, consuming about 45% of property tax revenue collected. The cost of policing continues to increase. For example, RCMP officers were paid significantly less than municipal police officers. A few years ago, they signed their first collective agreement, resulting in a significant salary bump. Policing has also become more sophisticated, meaning that more technology and time are required to do their job, leading to increased costs beyond inflation.

The City has also stepped up the services we provide. For example, we have increased the maintenance of our streets and parks, invested more in events, increased firefighting resources to step up preventative inspections, and invested in people to help us shore up our social infrastructure, such as addressing poverty.

I asked City staff to calculate how much the property tax would increase to keep up with inflation, otherwise known as the consumer price index.

The following tables show how much property tax would need to increase just to cover inflation and how much property tax has actually increased for the average detached and attached home in Langley City from 2004 to 2023.

Average Detached Home
Year	City Taxes (Actual)	City Taxes (Inflation Only)
2004	$ 1,339	$ 1,339
2005	$ 1,409	$ 1,366
2006	$ 1,434	$ 1,390
2007	$ 1,459	$ 1,414
2008	$ 1,492	$ 1,444
2009	$ 1,571	$ 1,444
2010	$ 1,639	$ 1,463
2011	$ 1,685	$ 1,498
2012	$ 1,709	$ 1,514
2013	$ 1,747	$ 1,513
2014	$ 1,797	$ 1,528
2015	$ 1,889	$ 1,545
2016	$ 1,959	$ 1,573
2017	$ 2,065	$ 1,607
2018	$ 2,057	$ 1,651
2019	$ 2,059	$ 1,689
2020	$ 2,117	$ 1,702
2021	$ 2,220	$ 1,750
2022	$ 2,499	$ 1,870
2023	$ 2,793	$ 1,964

Average Attached Home
Year	City Taxes (Actual)	City Taxes (Inflation Only)
2004	$ 641	$ 641
2005	$ 645	$ 654
2006	$ 684	$ 665
2007	$ 727	$ 676
2008	$ 760	$ 691
2009	$ 792	$ 691
2010	$ 800	$ 700
2011	$ 816	$ 716
2012	$ 807	$ 724
2013	$ 800	$ 724
2014	$ 801	$ 731
2015	$ 778	$ 739
2016	$ 739	$ 753
2017	$ 708	$ 769
2018	$ 809	$ 790
2019	$ 946	$ 808
2020	$ 986	$ 814
2021	$ 1,042	$ 837
2022	$ 1,009	$ 895
2023	$ 1,145	$ 940

For the average attached home, the difference between the inflation only and actual increases is $205 over the last 20 years. The difference is $829 for detaching housing over the last 20 years.