Public Services and Procurement Canada
2025 to 2026 Departmental Plan: Payments Instead of Property Taxes to Local Governments Program

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 Program is a statutory program administered under the authority of the Payments in Lieu of Taxes Act.

Fiscal year for terms and conditions:

The Payments in Lieu of Taxes Act was last amended on 2023-09-01.

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 Program.

Purpose and objectives of transfer payment program:

The Payments Instead of Property Taxes to Local Governments Program issues payments to taxing authorities under the authority of the Payment 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, please 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.

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 Payments Instead of Property Taxes to Local Governments Program is not included in the 2024 to 2025 through 2028 to 2029 Departmental Evaluation Plan.

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 on forecast spending for 2024 to 2025 and on planned spending for fiscal year 2025 to 2026 to fiscal year 2027 to 2028 by type of transaction (in dollars)

Type of transfer payment	2024 to 2025 forecast spending	2025 to 2026 planned spending	2026 to 2027 planned spending	2027 to 2028 planned spending
Payments to municipalities and other taxing authorities	631,775,117	650,065,207	663,066,511	669,697,176
Recoveries from custodian departments	(631,775,117)	(650,065,207)	(663,066,511)	(669,697,176)