Thank you, Mr. Speaker. Mr. Speaker, you heard me talk about the taxation issue in Fort Liard, and I have questions for the Minister of Finance. My first question: as a department, how did they come up with the mill rate for the Community of Fort Liard? Thank you, Mr. Speaker.
Masi. Minister of Finance.
Thank you, Mr. Speaker. Mr. Speaker, the Hamlet of Fort Liard's mill rate is the general mill rate which was first established in 1988 and over time has increased, as decided by the Minister of Finance. As part of the new deal in 2005, general taxation area communities were able to request increases to their general mill rate to raise additional revenues to pay for community services. Beginning in the 2010-2011 fiscal year, the general mill rate has been escalated by the inflation rate.
I thank the Minister for his answer. Can the Minister please explain to us: what is the percentage that the GNWT keeps from collecting the taxation for the community?
Mr. Speaker, the property tax invoices are broken down into three sections. You've got the general tax, school tax, and any interest. The school tax is approximately 48 per cent of the property tax invoice for the current year, and all the interest charged is revenue for the GNWT to fund schools and other government programs. The general tax portion is approximately 52 per cent of the property tax invoice for the current year and is currently granted back to the communities through the MACA Property Tax Revenue Grant Program under the new deal once an invoice for the years of 2004 to present has been paid off.
I thank the Minister for that answer. In my Member's statement, you heard me say that the interest rate is coming out at 15 per cent, and it seems to be very high. Was the community consulted or engaged in coming up with this rate?
I am not sure what type of consultation they had in 1988 as far as the mill rates go. The Member mentioned the interest rate of 15 per cent, and I believe he mentioned in his Member's statement that there was one outstanding tax of, I think it was, $50,000 plus interest; or I am not sure if that included interest, but plus interest would have come out to about $100,000. We do not want to see anybody get that far in debt to the Government of the Northwest Territories. That is why we encourage people to try pay their property taxes. If you look territory-wide, we have about $9.7 million in outstanding taxes that should be coming to the Government of the Northwest Territories so we can in turn reinvest that money into providing services. That is why we continue to encourage people to enter into repayment plans or try to make sure that their taxes up to date, because, $50,000 taxes, that would be like not paying your taxes for about 20, 25 years.
Masi. Oral questions. Member for Nahendeh.
Thank you, Mr. Speaker, and I thank the Minister for that information. Yes, it was a $15,000 taxation, but, you know, you add $55,000 to it, it all becomes a $70,000 tax bill, and some of these people are inheriting these from people as their parents or families are passing away. I guess my understanding is that the Government of the Northwest Territories was a collection agency for these municipalities that are not tax-based, but all of a sudden, you know, they are collecting it, and 48 per cent of it is going to school and 52 per cent to the hamlets, which is great, or the municipality. My question, though, is: it's my understanding that this 15 per cent interest rate happening, of non-payment, is actually going to the GNWT and not to the municipality, so can the Minister explain to me why that 15 per cent interest rate is going to the Government of the Northwest Territories?
The Member is correct. All interest charges that are collected remain with the GNWT, and we keep the money because we bear the cost of collections, so that is why we keep the money. Again, I have to make the point that we do not want to see people getting that far into tax arrears. A few years ago, I think there was an initiative to try to have the communities themselves set their own mill rates, collect their own taxes, and use it, but most communities, other than these tax-based communities which already do it, did not want that option because then they in turn would have to deal with the non-payment of taxes and the interest that is collected. So, we would like to enter into repayment plans with anyone who wants to come forward and have a discussion on the repayment of their plan.
As far as the interest rates go, I mean, that money still stays with the government, and it may have to be a broader discussion. One of the things I am concerned about is, if we do it in one community, start forgiving the interest, then we have to do it territory-wide and we send the message that, if you don't pay your taxes, don't worry about the interest; we are going to write it off. Thank you, Mr. Speaker.
Masi. Oral questions. Member for Yellowknife North.
