Toronto taxpayers need to ask themselves whether they can afford to pay for Chow’s agenda
Olivia Chow’s mayoral candidacy could be expensive for Toronto taxpayers.
“I am ready to tax,” declared Chow in launching her campaign.
So far, she’s demonstrating Toronto taxpayers should take her commitment seriously.
Chow appears fully prepared to raise property taxes above and beyond the rate of inflation. She is also promising to introduce a luxury homes tax. And Chow is pledging to tear down the eastern portion of the Gardiner Expressway, a plan that will increase gridlock and cost taxpayers hundreds of millions of dollars.
Chow also has a record. She was a key ally of former mayor David Miller, who never met a tax he didn’t like, or hike, when she served on council.
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Chow’s platform shows she plans to follow in Miller’s footsteps. Consider three of her key platform planks.
First, Chow has indicated she’s fully prepared to raise property taxes well above the rate of inflation. That represents a major threat to seniors and young families.
Torontonians’ average property tax bill is already nearly $4,000. In percentage terms, Torontonians may pay lower property taxes than those in neighbouring municipalities. However, because homes are worth so much more, Torontonians pay high property taxes in real dollar terms.
Many of Toronto’s homes are owned by seniors who bought their homes decades ago when their houses cost a fraction of today’s prices. But just because their home values have gone up doesn’t mean they have more cash in the bank. For seniors on fixed incomes, a property tax hike at the rate of inflation is bad enough. A tax hike above that could prove to be financially crippling.
Soaring property taxes also hurt young families. Many Toronto homeowners were barely able to scrape up enough cash to get into their homes, and their budgets are stretched. Hammering homeowners even further could break a family budget. And higher property taxes make it even less likely that renters will be able to enter the ownership market.
Second, Chow is also promising to introduce a luxury homes tax. Right now, everyone buying a home in Toronto must pay a municipal and provincial land transfer tax. Toronto is the only city in Ontario with a land transfer tax, which already makes buying a home in Toronto out of reach for many. Chow wants to increase the top land transfer tax rate on homes worth over $3 million.
A luxury homes tax may sound nice, but there’s no guarantee Chow will only hike the land transfer tax on very expensive homes. She might start with homes over $3 million, but if Chow plans to spend as much as she seems to be planning, the city will be looking for more revenue. Chow could easily lower that threshold to $2 million or even $1 million, which would suddenly impact average homebuyers in the expensive Toronto housing market.
When the income tax was first introduced, it only applied to the top two percent of income earners. Today, virtually everyone pays it. Chow will be looking for more dough, so there’s a real risk she will eventually impose the land transfer tax on all home sales, not just on the rich.
Finally, Chow wants to tear down the eastern portion of the Gardiner Expressway, even though the city has already spent $550 million on the repair process. To throw away all that cash and abandon the project doesn’t make sense. Not to mention that losing the Gardiner would dramatically increase gridlock.
Chow’s plans are dangerous for Toronto taxpayers. And because the Ford government has handed the Toronto mayor new “strong mayor” powers, including the power to pass some policy proposals with the support of only one-third of council, Toronto voters need to get this right.
Toronto taxpayers need to ask themselves whether they can afford Chow’s agenda.
Jay Goldberg is the Ontario & Interim Atlantic Director for the Canadian Taxpayers Federation.
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