The impact of property taxation on business investment in Alberta

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dc.contributor.authorDahlby, Bev
dc.contributor.authorFerede, Ergete
dc.contributor.authorKhanal, Mukesh
dc.date.accessioned2021-12-17
dc.date.accessioned2022-05-31T01:44:51Z
dc.date.available2022-05-31T01:44:51Z
dc.date.issued2021
dc.description.abstractAlberta municipalities rely heavily on property taxes levied on residential and non-residential sectors to finance local public services. This paper investigates the effects of non-residential property tax rate on business investment using panel data from 17 Alberta cities over the 1998-2017 period. We find that a one mill increase in the non-residential property tax rate is associated with a $49 decrease in commercial and industrial real capita investment. Based on this estimate, we calculate the marginal cost of public funds for the non-residential property tax, which range from 3.12 for Lethbridge to 1.21 for Leduc. We also find that business taxes that are levied on the rental value of a business property have a negative impact on investment, while higher expenditures on municipal services do not have a significant effect on business investment.
dc.format.extent810.06KB
dc.format.mimetypePDF
dc.identifier.citationDahlby B, Ferede E, Khanal M (2021). The impact of property taxation on business investment in Alberta. SPP Research Papers, 14(8). https://doi.org/10.11575/sppp.v14i.69686
dc.identifier.doihttps://doi.org/10.11575/sppp.v14i.69686
dc.identifier.urihttps://hdl.handle.net/20.500.14078/2510
dc.languageEnglish
dc.language.isoen
dc.rightsAttribution-NonCommercial (CC BY-NC)
dc.rights.urihttps://creativecommons.org/licenses/by-nc/4.0/
dc.subjecttax rates
dc.subjectnon-residential property
dc.subjectbusiness investments
dc.titleThe impact of property taxation on business investment in Alberta
dc.typeArticle
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