Alberta’s government says it is putting together a working group with municipal leaders to find “potential solutions” to help municipalities collect millions owed in unpaid oil and gas property taxes.
The aim of the working group is to develop a new property tax accountability strategy which will make recommendations to recover unpaid taxes, close loopholes that allow companies to run up tax debts, and improve communication between industry, municipalities, and the province.
Rural municipalities are currently owed $253.9 million in unpaid property taxes by oil and gas companies. In 2024 alone, the outstanding tax owed by oil and gas companies increased by $67.8 million, according to a recent report from the Rural Municipalities of Alberta (RMA).
“Rural municipalities continue to face the long-standing issue of unpaid oil and gas property taxes, putting immense strain on their financial sustainability,” RMA President Kara Westerlund said in a statement.
“We are encouraged by the willingness of both Alberta Municipal Affairs and Alberta Energy and Minerals to collaborate with RMA to form the Property Tax Accountability Strategy working group. Together, we can create solutions that address this issue and restore a partnership between municipalities, government and industry.”
In an interview earlier this month, Westerlund said municipalities lack any legal mechanism to force oil and gas companies to pay property taxes, and this weakness is well known within the industry.
The proportion of outstanding tax owed by insolvent companies has increased to 60 per cent in recent years, adding to the difficulty municipalities face in recovering these debts.
Westerlund said she hoped the new property tax accountability strategy would address these tax loopholes, evaluate weaknesses within the provincial government, and look at what the Alberta Energy Regulator can do to enforce payment.
“Whether you like it or not, you have to pay your taxes. We’re committed to working with our municipal partners to ensure that bad actors in the oil and gas industry are held to account, and that municipalities are paid the property taxes they are due,” Municipal Affairs Minister Ric McIver said in a statement.
