Nova Scotia’s Capped Assessment Program Shifting Property Tax Burden to Renters
New analysis from Turner Drake & Partners examines the impact of Nova Scotia’s Capped Assessment Program (CAP), concluding that the system increasingly shifts municipal property tax burdens from homeowners onto rental housing and other uncapped properties. While the CAP limits annual assessment increases for most owner-occupied homes by tying taxable values to inflation, rental buildings with four or more units are excluded from the program.
As housing values surged in recent years, the amount of “untaxable” assessment under the CAP has expanded significantly. In Halifax Regional Municipality alone, capped assessments removed approximately $23.6 billion from the taxable base in 2025, requiring residential tax rates to be about 37% higher than they would otherwise be. The resulting tax shift is estimated to total roughly $81.5 million annually, with many rental properties bearing a disproportionate share of the cost.
The report finds that while more homeowners are now benefiting from capped assessments, the burden on uncapped properties has grown heavier. Approximately 101,000 dwelling units—primarily rental apartments—are effectively paying higher taxes to offset the tax relief provided to capped homeowners. The analysis suggests the policy may unintentionally increase operating costs for rental housing and create barriers to new apartment development.
View the full report at Who Wears the CAP Now