Why the massive increase in your home's value in Okanagan, Kamloops doesn't mean a whopping tax hike
Recently released numbers from B.C. Assessment has left many flabbergasted at how much their property's value has increased.
But if you're worried the 30 per cent or more increase, which the majority of homes throughout Kamloops and the Okanagan have seen, means a 30 per cent increase in your property taxes luckily that's not the case.
While the assessed value of your home is directly linked to how much property tax you'll pay, there's no need to panic that your taxes will skyrocket just because the value of your home has.
READ MORE: House price assessments increase roughly 30 per cent in Kamloops, Okanagan
City of Vernon financial services director Debra Law took to the time to explain how the system works.
"We increase or decrease the... tax rate to get the total amount of taxation that we need," Law said.
Law said this year's jump in property prices is unprecedented so the tax rate, also called the mill rate, will be dropped significantly.
The mill rate is worked out by dividing the amount of money a city needs in its budget by the total value of all properties in the city.
READ MORE: Report says tax on $1M+ homes could be key to making housing more affordable
So as the 18,600 properties in Vernon increased in value by 31 per cent to $11.6 billion from $8.8 billion, the City will adjust the tax rate accordingly.
This year Vernon council also decided the City needed to increase its budget by six per cent. So the mill rate will be calculated to collect a six per cent increase. But that doesn't mean everybody will see a six per cent increase in their tax bill.
People in Vernon whose property increases by the average of 30 per cent will be looking at a six per cent increase, but those whose property increased by less than the average of 30 per cent will see a smaller tax increase.
Of course, it's not quite that straightforward because there's a difference between tax rates for business and residential and the exact tax rate people will pay hasn't as yet been finalized, but there's no need to panic that that whopping increase in your home's value will mean an enormous increase in your taxes.
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