Toronto has the lowest property tax rate in the Golden Horseshoe: the prosperous region stretching from Oshawa around the end of Lake Ontario to the Niagara River. We also have some of the best city services in Canada: services under increasing financial strain. Too many of our citizens have no homes. Some, and any is too many, die on the street every year. This is unacceptable; the city must fulfill its responsibilities, and that almost certainly means taxes have to go up.
Members of city council have suggested other revenue tools (read: new forms, more equitable forms, of taxation), but for now we have the old stand-by, property, or real estate, taxes. Since real estate taxes can and sometimes do have perverse and unfair effects, I present three modest proposals to make real estate taxes more fair, and to ensure the impact of the needed tax increase falls where it should: on those best able to pay.
1) Tax rebates for heritage properties
If the city designates your home or business property as a heritage property, they should not then tax you as though you owned a large and tall modern building, even if the province's assessment corporation sets the value of your property on that basis. The taxes assessed on a property should be set according to the actual return on the property, and where the public interest outweighs the market valuation of the property, the city should levy taxes according to the public interest.
2) Tax deferral for pensioners
Where the market value of a home owned by pensioners increases sharply, it makes sense for the city to defer some of the associated taxes, rather than permit city taxes to force people out of their homes. A scheme to defer some portion of the property taxes until the sale of the property, on a basis similar to a reverse mortgage, would permit seniors to stay in their homes and communities.
3) Tax rebates for affordable housing
The city tends to tax renters more heavily than home owners, because the landlords pay the tax bill and pass the cost of the taxes along in the rent. This makes housing less affordable, moving the city farther away from one of its most important goals. Ideally, a generous tax rebate for affordable housing units, with rents below a certain amount for a given unit type, would accompany any general property tax increase.
Better and more qualified thinkers than myself have undoubtedly addressed these questions, but the city budget is coming up, so I think it important to have as many voices addressing the subject as possible.