2024 to 2025 Departmental Plan: Details on transfer payment programs of $5 million or more

Overview

Name of transfer payment program

Payments Instead of Property Taxes to Local Governments

Start date

1950

End date

Ongoing

Type of transfer payment

Payments in lieu of taxes

Type of appropriation

The Payments Instead of Property Taxes to Local Governments is a statutory program administered under the authority of the Payments in Lieu of Taxes Act.

Fiscal year for terms and conditions

The last major update of the Payments in Lieu of Taxes Act was in fiscal year 2000 to 2001.

Link to departmental result(s)

Canadians, businesses and organizations receive payments on time and revenues are collected for government services in an efficient manner.

Link to the department’s program inventory

Payments Instead of Property Taxes to Local Governments.

Purpose and objectives of transfer payment program

Payments Instead of Property Taxes to Local Governments Program issues payments to taxing authorities under the authority of the Payments in Lieu of Taxes Act. Local governments receive payments in recognition of the services they provide to federal property located in their jurisdictions because the Government of Canada property is exempt from taxation. The program provides payments to local taxing authorities on behalf of relevant federal custodian departments and agencies.

For more information, visit the Payments in lieu of taxes for federal properties website.

Expected results

Canadians, businesses and organizations receive payments on time and revenues are collected for government services in an efficient manner. Specifically, local taxing authorities receive fair, equitable and predictable payments on behalf of the Government of Canada in recognition of the services they provide to federal property located in their jurisdictions and as contribution to the cost of local government. Key performance indicator to measure the program result is as follows:

Departmental result indicator: Percentage of payments made instead of property taxes to taxing authorities within established timeframes.

Last completed evaluation 

Fiscal year of last completed evaluation

2009 to 2010 (the last program evaluation was completed on March 18, 2010).

Decision following the results of last evaluation

Continuation was confirmed. The program rationale is sound and relevant and there is a continued need for the program. The administration of payments in lieu of taxes is a mechanism that allows the federal government to share the cost of services provided to federal properties by local government and helps fulfill the federal government's objective of being a responsible property owner. The Payments in Lieu of Taxes Act continues to be the mechanism through which payments are paid.

Fiscal year of next planned evaluation

The program is scheduled for evaluation during fiscal year 2025 to 2026 per the departmental 5-year evaluation plan (fiscal year 2023 to 2024 to fiscal year 2027 to 2028).

General targeted recipient groups

Taxing authorities including municipalities (local governments).

Initiatives to engage applicants and recipients

The program is engaging the payment recipients (taxing authorities) by hosting meetings with municipal representatives. The meetings included a presentation about the Payments instead of Property Taxes to Local Governments Program and an open forum for the representatives to ask questions.

Financial information

The table below shows financial information on forecast spending for 2023 to 2024 and on planned spending for fiscal year 2024 to 2025 to fiscal year 2026 to 2027 (in dollars) for payments to municipalities and other taxing authorities and for recoveries from custodian departments.

Related links

• 2024 to 2025 Departmental Plan
• Payments in lieu of taxes for federal properties