Canada/QST Sharing: Regional Municipalities Stand to Gain
Saguenay-Lac-Saint-Jean could come out a winner in the new Quebec Sales Tax (QST) sharing formula proposed by Quebec. Saguenay would get about $500,000 more in the first year. Almost all of the region's municipalities would also receive more, according to the Fédération québécoise des municipalités (FQM).
The draft regulation specifying the distribution of the amount among municipalities was published in La Gazette officielle du Québec on August 27.
It stems from the new fiscal pact signed between Quebec municipalities and the Legault government last November for the 2024-2025 period.
At the time, the agreement confirmed the sharing of an annual amount equivalent to the growth in revenues generated by one point of QST. However, the distribution of these revenues among the municipalities was not determined.
The population of a municipality will no longer be the sole criterion in the new calculation method, as proposed by Québec. The economic vitality index and the remoteness of municipalities will be taken into consideration.
These two factors will account for 2.5% of the calculation in 2025. This percentage will rise progressively to 10% in 2030.
Municipalities considered remote and devitalized will therefore receive more than they did before, according to a calculation that will be applied to the situation of each municipality. The remaining 90% considered in the calculation will remain based on population.
500,000 more for Saguenay in 2025
The amounts that the various municipalities in the region could receive are not yet known.
However, Saguenay estimates that by 2025, the new QST distribution formula will represent an additional $500,000 in the municipality's coffers.
Estimates for subsequent years are not yet available. Saguenay mayor Julie Dufour welcomes the new formula.
To my knowledge, Saguenay is the only large city that will have more," she said in an interview on Thursday. She is delighted that the calculation favors the smaller municipalities in the region.
For Saguenay, it's excellent news, and for the regions too. You have to understand that this is a very bold move by the Minister of Municipal Affairs. For years, we've been talking about land occupation, for small villages that are losing occupants, but still have infrastructures and major issues at stake.
A quote from Julie Dufour, Mayor of Saguenay
As for Alma, the municipality still had to make calculations to be able to estimate the impact of this distribution on the envelope it will receive.
However, the proposed regulation will not make everyone happy. Quebec's major cities are expecting to lose revenue. For Gatineau, this loss will represent $540,000 in 2025, reported Le Droit, on Thursday.
A positive agreement for the region, says the FQM
The president of the Fédération québécoise des municipalités (FQM), Jacques Demers, believes that the new by-law will enable several municipalities in the region to benefit from larger sums of money.
For Saguenay, Alma, the vast majority - I dare say, all - in your region, will be going after it. The need is there," he said.
The organization believes that the municipalities will come out ahead.
Our calculations and forecasts for the time being are that all these towns are going to be looking within [the 10%]. That's where we see that it's not a question of big or small cities, but of municipal needs.
A quote from Jacques Demers, President of the Fédération québécoise des municipalités
The envelope for all municipalities is estimated at more than $600 million for 2026, and should reach $1 billion by 2030.
Support for municipal services
Luc Simard, Prefect of the Maria-Chapdelaine RCM, believes that the new formula is first and foremost a question of fairness for smaller municipalities. Mr. Simard is also a member of the FQM executive.
He believes that the additional sums expected will help municipalities maintain their services.
When we look at the issues of municipal mergers we're talking about today, and the consolidation of services, we're often heading in that direction, because these municipalities have much lower incomes, find it difficult to pay their employees properly, or to maintain their services. to pay their employees well, to have a retention capacity," he emphasized, referring to the merger being considered by Saint-Augustin and Péribonka.
The prefect, whose MRC ranks last in the economic vitality index, also believes that this new distribution will make it easier to recruit employees.
We think that this measure will also give these municipalities a helping hand in finding quality employees, employees who will be able to remain in their service. So we think it's a really good measure.
A quote from Luc Simard, Prefect of the Maria-Chapdelaine RCM
The Minister of Municipal Affairs, Andrée Laforest, would not comment on the publication of the new by-law until it has been finalized. Municipalities have a few weeks to comment on the draft by-law.
Source: ici.radio-canada.ca
