Montreal to cap property tax increases at 1.8% in 2025

After residential taxes increased nearly 10 per cent over the past two years, Montrealers — and their wallets — are finally getting a break. 

A year before the next municipal election, the Plante administration said it will limit the centre city's property tax increases to 1.8 per cent for homeowners and businesses in its 2025 budget.

The city said people are struggling financially, so it worked diligently to keep its promise to hold the tax increase within the rate of inflation — and announced this intention earlier than usual.

"We want to assure the population because people are stressed," the head of the city's executive committee, Luc Rabouin, said at a news conference Thursday.

"There's been an increase in the cost of living over the past few years, an increase in rental costs, an increase in the cost of groceries … so we want to tell them right away, 'don't worry.'" 

This increase, in line with inflation in the Montreal region between August 2023 and August 2024, should be a relief for Montreal homeowners who saw their tax bills increase 4.9 per cent in 2024 and 4.1 per cent in 2023, in addition to a significant rise in the cost of living.

Rabouin says his administration's efforts to reduce spending, revise programs and increase efficiency have made it possible to keep the increase in Montrealers' tax bills within the limits of inflation.

He refused to say what cuts were made to make this possible, saying the city will have more details when it announces its 2025 budget at the end of November.

City asks boroughs to also hold line on inflation

The city's share of the property tax bill makes up 87 per cent of the total, said Rabouin. Boroughs set their own tax rates, which are expected to be announced in the coming weeks, but mostly rely on money transfers from the city for funding.

Rabouin said the city will be transferring 1.8 per cent of tax revenue to the boroughs, which should "facilitate their decisions" to also hold the line on inflation. 

"Of course, we all have a challenge to offer quality services to the population but [also] to respect their capacity to pay," he said.

"So we made the effort at the city level and all the boroughs [also have to] make the effort." 

Villeray–Saint-Michel–Parc-Extension has already mapped out its plan for taxes, announcing an increase in local tax revenue of three per cent. 

Rabouin called out boroughs such as Montréal-Nord, Anjou and Saint-Léonard, which already have some of the highest property taxes in Montreal. 

"I could not understand if they increase their local taxes more than five per cent. It's just not comprehensible," he said. 

'Trying to put lipstick on a pig,' says Opposition

At the same news conference Thursday morning, Saint-Laurent borough mayor and Official Opposition finance critic Alan DeSousa took no time ripping into the city's plan.  

"We all know that there's an election in a year, and clearly they're trying to put lipstick on a pig," he said. 

DeSousa accused the administration of not giving boroughs enough to keep taxes low and making choices that "clearly have an electoral bend." 

"If the boroughs are increasing [taxes], it's because they are clearly wanting to not cut into essential services," he said. 

With almost $9 out of every $10 paid in property taxes going to the city's central authority, DeSousa says the city is "looking in the wrong place for expenses." 

"They're not doing anything in regard to excessive spending or waste happening at the city level," he said, saying the city has systematically not just increased expenses, but also taxes. 

Rabouin said the Opposition's accusations are paradoxical to their demands.

"They're always asking us to spend more and they criticize us when we spend money," he said. 

He said the city is focused on the priorities of citizens and will maintain services despite limiting the money it collects through taxes next year.