Ontario Construction News staff writer
Toronto council has approved a plan to increase municipal land transfer tax rates for homes valued at $3 million or higher and directed staff to report back on plans to implement a foreign buyer land transfer tax, introduce a commercial parking levy and increase the vacant home tax from one to three per cent.
Also, the city will ask for permission from the Ontario government to implement a municipal sales tax, a move Mayor Olivia Chow says could generate $1 billion per year for the city. If approved by the province, the new tax would be applied to goods and services purchased in Toronto.
“We know that we are stronger together,” she said during a news conference before the debate. “And there’s no dispute that every councillor understands that the City of Toronto is in a budget deficit situation.”
A graduated municipal land transfer tax rate would start with 3.5 per cent added to homes valued at more than $3 million up to $4 million and rise to 7.5 per cent on homes valued at more than $20 million. It could generate $26 million per year, according to a staff report.
Mayor Chow is also calling on the provincial and federal governments for help.
“We need to have good working relationships with other levels of government,” she said. “But prior to that, we need to come to the table with what we can do, what’s within our power to do, and that’s what’s laid out in front of councillors.”
A staff report presented to council detailed measures that will take time to investigate and implement.
Coun. James Pasternak spoke against the sales tax.
“A made-in-Toronto sales tax, it just won’t work,” he said. “People will shop elsewhere, they will leave our jurisdiction and shop at retail stores outside of Toronto.”