Montreal budget: How much are your municipal taxes going up by?

Mayor Soraya Martinez Ferrada’s budget triples funding for homeless services and allocates over $500 million for affordable housing in new budget.

Municipal taxes across Montreal are set to go up by 3.8 per cent in 2026, representing about a $188 increase for an average home.

The City of Montreal and new Mayor Soraya Martinez Ferrada presented a balanced budget of $7.67 billion, an increase of $389 million, and a 10-year $25.9-billion capital expenditure program on Monday morning.

The city notes that the budget also represents $79 million in savings in central service activities and other optimization measures.

“Our administration’s first budget marks a significant change in the city’s priorities,” said Martinez Ferrada. “Montrealers asked us to listen to them and refocus spending on citizen services, and today we are delivering on that promise.”

Martinez Ferrada insists the city limited tax increases to inflation and increased borough transfers to support services.

“This is a first step in the necessary restructuring of the city to make it more efficient, a task that will continue throughout the term of office to slow the growth of spending,” said the City of Montreal’s Executive Committee Chair, Claude Pinard.

Montreal’s average tax increase is set at 3.4 per cent, to match inflation rates from Sept. 2024 to 2025, with property taxes increasing by an average of 3.8 per cent for residential buildings and 3.4 per cent for non-residential buildings.

Aside from debt servicing, the city says its expenditures will increase by 3.2 per cent.

Increases by borough and type of residential building:

Other spending

Martinez Ferrada has repeated several times that her administration plans to invest in improving the homeless situation throughout the city.

As such, her administration has earmarked $29.9 million for homeless services, an increase of $20 million from $9.9 million, as well as $11 million against poverty and social exclusion.

The city is also setting aside $100 million until 2035 to acquire and renovate buildings for emergency shelter spaces, as well as $578.7 million over the next 10 years to transform buildings into social housing.

“In addition to increasing the housing supply and finally, after so many years, developing the full potential of eastern Montreal, our administration will invest historic sums to combat homelessness and get Montrealers off the streets,” said the mayor. “This budget marks an important first step in restoring citizens’ pride in living in the largest French-speaking metropolis in the Americas.”

Additionally, it is allocating $11 million to the creation of a tactical intervention group and establishing a protocol to manage encampments.

The government says it also plans to prioritize six development sectors to accommodate nearly 75,000 homes by 2050, with an increase in investments of $47.6 million: Lachine-Est, Namur Hippodrome–Cavendish, Louvain-Est, des Faubourgs, the Blue Line corridor and Bridge-Bonaventure.

To increase safety around schools, the government is injecting $17.4 million to hire additional crossing guards, among other things, and $15.8 million for violence prevention.

The city is also investing $6.7 billion in road infrastructure and prioritizing east Montreal, with the creation of an office in the area.

Additionally, $38 million is being set aside for Montreal’s water strategy.

As promised during her election campaign, the mayor says she plans to eliminate 1,000 jobs, which would result in savings of $78.6 million.

‘A little bit betrayed’

Nicolas Gagnon, with the Canadian Taxpayers Federation, points out that Montrealers are already having a hard time keeping up with soaring prices, whether it be at the grocery store or at the pump.

“We expect the city to do more to find savings and avoid that we have taxes that can increase at a level that is unsustainable for Montreal families,” he said. “I can understand why the taxpayers of Montreal feel a little bit betrayed with this new budget.”

Gagnon notes that he was surprised that the government wasn’t able to find more savings in its budget, “to avoid giving to the taxpayers of Montreal such an increase in this new year.”

“We increased expenses higher than inflation, we increased taxes higher than inflation,” he said. “We find very little savings, so it feels like nothing has really changed between the previous administration and the new one.”

Not what Montrealers were expecting

Political analyst Justine McIntyre said the budget is not what Montrealers were expecting after all the talk about efficiency.

She said that although Martinez Ferrada met some of her campaign promises, such as tackling homelessness, the administration has yet to deliver concrete gains in efficiency.

“She said she wants to reduce by 1,000 employees the number of employees at the city, which is well over 25,000 employees right now,” McIntyre said.

“In fact, they managed to reduce only 16 full-time positions. So it looks like they haven’t even made a dent towards that 1,000 reduction that they want to see. So when it comes to efficiency, when it comes to a tighter budget, we are not seeing that at all.”