Should Toronto raise property taxes?
By now it’s an academic question — since amalgamation, our governing politicians have overwhelmingly decided the answer is no. This includes Mayor John Tory, whose staff are fond of pointing out that holding property tax increases to the rate of inflation was one of his signature campaign promises. So it’s not going to happen.
That didn’t stop researchers at the Ryerson University Centre for Urban Land Research from tackling the question. They concluded that, by regional standards, Toronto has very low property taxes. In straight-up dollars paid, only five out of 29 municipalities in the GTA charge less than Toronto.
Some charge much more: King City’s average homeowner paid $6,978 compared to Toronto’s average of $4,027. As a percentage of household income, Toronto’s rates looked even better: by that measure, only one municipality had lower taxes than us. The Ryerson researchers concluded that if Toronto raised taxes by 20 per cent, it would still only bring us up to the median amount paid across the GTA.
Anyone paying close attention drew the same conclusion a long time ago. I have been among those who have pretty much worn out their keyboards suggesting maybe the city ought to do just that. Not a 20 per cent hike in one go, but a gradual increase up to about the GTA average.
That would be entirely reasonable.
But I have also come to understand that it is entirely unrealistic, because those in charge — starting with Tory — have made it clear they ain’t gonna do it. They know the same thing Ryerson found, and they knew it before they went out and got elected on a promise not to do it. They have their reasons, among them that, whatever its virtues, this city is home to the loudest chorus of whiners about property taxes you’ll find just about anywhere. I’ve written before about why I am unsympathetic to that whining. I probably will again.
The mayor and his allies, however, are sympathetic. Luckily for the whiners, those are the people who got elected.
Meanwhile, the city is falling apart while the municipal government cries poor. Department budgets have flatlined or been cut for years because there isn’t enough money to go around. TTC fares keep going up, even as the system is perilously overcrowded. Homeless shelters are overflowing. The city can’t clear snow from the streets in a decent amount of time. Affordable housing units get shut down because we can’t maintain them at a decent enough standard for people to live in.
Bob Richardson was Tory’s campaign co-chair in 2014. In a Twitter conversation with my Star colleague Jennifer Pagliaro this week, he defended the mayor honouring his campaign pledge. But then he wrote, “I think however we need to look at a number of things outside of property tax which is always the fall back … no question more (revenue) needed.”
He’s right about the last part. As much as our political power class disagrees with property tax increases, they also agree more money is needed. So here’s the thing: if more is needed, and you have declared the most obvious source to be off limits, then step right up and explain what the other sources are. And then get on with collecting from them.
We’ve been waiting a long time. David Miller did raise property taxes by more than inflation, and also brought in the land transfer tax that has saved his successors’ financial hides. But Rob Ford promised to find a gravy train full of cash to fund our wildest ambitions, and never did.
John Tory, now into his second term of nipping and tucking, is kicking the can down the road by deferring maintenance and raiding reserves. To his credit, he did bring in a hotel tax, and that makes a small difference. He also proposed road tolls, which the province vetoed before giving us some new cash from gas taxes.
But if that was enough, the city government wouldn’t still be crying poor. More revenue is needed, no question. Where is it coming from?
The favourite answer of local politicians is Ottawa and Queen’s Park. But those governments can — and do — point to the fact that we refuse to collect taxes at a rate anywhere near that of our neighbours. Why would they fund us if we won’t fund ourselves?
What else is there? Do you have an answer that’s better than property taxes? Great, bring it. It’s time to show us the money.
Edward Keenan is a columnist based in Toronto covering urban affairs.
https://www.thestar.com/opinion/star-columnists/2019/03/01/property-taxes-are-the-obvious-solution-to-torontos-revenue-crisis.html
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