REGINA — Local businesses across Regina are preparing for the financial ripple effects of the largest property tax increase in the city’s history.
The City of Regina approved a 10.9 per cent mill rate increase for 2026, a decision that followed five days of intense budget debate and ultimately passed council in a narrow 6–5 vote.
The increase, which takes effect in June 2026, is accompanied by a 7.82 per cent utility rate increase, meaning both property taxes and municipal utilities will rise for residents and businesses alike.
City officials estimate the combined increases to taxes, utilities and the library levy will add about $38.70 per month for the average household.
For many businesses, the changes represent another cost in an already challenging economic environment.
Local businesses preparing for the impact
Mark Shmelinski, co-owner of Regina’s The Everyday Kitchen, explained that while the increase is significant, many businesses will likely absorb the cost rather than immediately raise prices.
“I don't think it's going to be something that has to be passed on, but it's something that we as businesses in general just have to account for,” Shmelinski explained.
“So that revenue has to be there. Whether that's an increase in revenue or if we're able to streamline our costs in any way to make up some of that, all of that kind of goes hand in hand.”
Shmelinski acknowledged that running a city comes with its own financial realities, particularly when it comes to maintaining aging infrastructure.
“I wouldn't want to be in their shoes having to make these decisions,” he commented. “Dealing with infrastructure deficits and pieces like that is a huge responsibility.”
Still, he emphasized that tax increases have a broad ripple effect across the local economy.
“It does have a trickle-down impact across the board for everybody,” he noted. “Workplaces, businesses, small businesses, larger businesses, homeowners. It affects all of us.”
Why the increase is happening
City leaders argue the tax hike is necessary to maintain essential services and invest in aging infrastructure across Regina.
The 2026 municipal budget funds more than 60 services the city provides, including policing, fire protection, road maintenance, waste collection and recreation programs.
Major spending in the new budget includes:
- $131 million for police services
- $55 million for fire and protective services
- $223 million for capital projects including road renewal
- $119 million for water utility infrastructure
City officials argue that years of rising costs, population growth and aging infrastructure have forced difficult financial decisions.
Property taxes make up roughly half of the city’s revenue, with the rest coming from government grants, user fees and other funding sources.
A closely divided decision
The vote at city council highlighted the difficult balance between affordability and maintaining services.
Some councillors supported the increase as necessary to protect infrastructure and public safety.
Others raised concerns about affordability for residents and businesses already facing rising living costs.
Despite those concerns, council ultimately approved the budget, trimming earlier projections that had suggested an even larger increase.
The bigger picture for Regina
Municipal leaders say Regina is facing many of the same pressures seen across Canadian cities.
Construction costs, inflation and the aging of roads, water systems and public facilities have dramatically increased the price of maintaining municipal infrastructure.
Without new revenue, city leaders have warned that services would face reductions or future tax increases could become even larger.
The importance of supporting local
For business owners like Shmelinski, the conversation ultimately returns to community support.
His company operates entirely within Regina, meaning every dollar it earns depends on local residents.
“We are 100 per cent a local business,” he noted.
“Every dollar that comes into our business needs to come from people who live and work here.”
That is why he believes supporting local businesses will become even more important as costs rise across the economy.
“We've always been aware of how important supporting local businesses is,” he expressed. “Places that give back to the community and stay connected to it.”
Shmelinski added that the long-term health of Regina’s business community depends on thoughtful decisions from all sides.
“I understand that cities need to invest in things,” he reflected.
“But people and businesses can’t just infinitely keep having their costs raised year after year.”
As Regina moves toward implementing the historic tax increase this summer, businesses, homeowners and city leaders alike will be watching closely to see how the decision shapes the city’s economic future.
