HALIFAX — The Halifax Regional Council is prepared to vote on a landmark proposal that could significantly alter how Nova Scotia Power (NS Power) pays its taxes. The move aims to repeal decades-old legislation that currently shields the utility company from paying property taxes directly to the municipality, a shift that could bring millions in additional revenue to the city’s coffers.
Since the privatization of the utility in 1992, Nova Scotia Power has been exempt from standard municipal property taxes under the Privatization Act. Instead of paying the city directly, the company provides a “grant in lieu of taxes” to the provincial government, which then redistributes a portion of those funds to municipalities. Councilors now argue that this 30-year-old arrangement is outdated and deprives the city of much-needed commercial tax revenue.
Councillor Kathryn Morse, a vocal supporter of the reform, highlighted that the city is under immense financial pressure due to rapid population growth. She argued that it is essential to collect fair commercial taxes from profitable entities like NS Power. Currently, the utility holds 251 properties within Halifax alone. Under the existing provincial formula, the municipality receives approximately $6.5 million annually; however, officials estimate that direct taxation would boost that figure to $7.9 million.
While the move promises a windfall for Halifax, it has raised concerns regarding equity for smaller municipalities across the province. The current provincial redistribution system was designed to ensure that tax revenue from large power plants is shared among all regions, rather than being concentrated solely where the physical plants are located. Critics fear that if Halifax exits the current system, smaller towns could see a decrease in their share of utility-related funding.
The Regional Council is expected to vote shortly on whether to officially petition the provincial minister to amend the legislation. If successful, the change would mark one of the most significant shifts in Nova Scotia’s municipal tax structure since the early 1990s.
