Rule Changes

The City of Toronto has begun the process to consider charging a second land transfer tax on property sales in Toronto that would amount to a 45% increase to the current land transfer tax . This option was included in a discussion paper on new revenue generating tools recently released by the City. While no decisions have been made yet by the City, the Toronto Real Estate Board (TREB) is taking this issue very seriously and is working to convince City politicians to oppose this tax.

It’s important that we exercise our power in numbers and make sure this increase to land transfer tax of up to 45% never sees the light of day. See below for ways to have your voice heard.

And if you don’t live in Toronto?  Your community could be next!

Say NO to Home Buying Tax, Your Help Counts and Matters

TREB is planning a comprehensive campaign, which will include numerous opportunities for TREB Members to provide input directly to the Mayor and City Council on this issue. In the meantime:

1. If you are concerned about the impact of a second land transfer tax on Toronto’s real estate market, you can assist TREB’s efforts by contacting your Toronto City Councillor and Mayor David Miller stating your opposition to this tax. YOUR VOICE COUNTS, flex your muscle.

2. You can send a simple brief email to the Mayor by clicking here (even if you don’t live in Toronto)

3. If you live in Toronto or are associated with an office in Toronto, it is important that you also email your local Toronto Councillor. You can determine who your Councillor is and get their contact information (including email) by entering your address at the City’s Councillors web page.

4. When you send emails to your councillor and the Mayor, please copy mritacca@trebnet.com or vpalmer@trebnet.com.

5. Strongly encourage your clients, customers, neighbours, friends and family to also voice their opinion by emailing Mayor Miller and their local councillor stating their opposition to this tax.

NOTE: If you don’t live in the City of Toronto you can still email Mayor Miller and the councillor in the area you conduct a lot of business. As long as you do business in Toronto or are concerned about your municipality being next on the list if Toronto succeeds with bringing in this tax, you should at least email Mayor Miller.

TREB Key Messages

TREB has sent an open letter to Mayor David Miller raising a number of concerns, including,

  • A city land transfer tax on top of the provincial land transfer tax is double-whammy taxation
  • Significant cost: on the average Toronto home, a second land transfer tax of 0.5% would cost approximately $1900, which represents a 45% increase in land transfer taxes. Even a 0.1% second land transfer tax represents close to a 10% increase.
  • What added benefits would homebuyers or businesses receive for paying a second land transfer tax?
  • Would make housing less affordable in Toronto
  • Would make it more difficult for Toronto to attract new businesses. Toronto’s high business property taxes already make the City less competitive than surrounding GTA municipalities.
  • Will encourage consumers and businesses to locate outside of Toronto where they wouldn’t have to pay a second land transfer tax, leading to more commuting, traffic, and smog.
  • Will hurt Toronto’s economy by reducing the spin-off spending that housing transactions generate for things like furniture, appliances, and renovations.

Significant further action is planned on this issue. TREB will be meeting with as many City Councillors as possible and will continue to work to raise the profile of this issue so that the public voices their opposition to City Council.

Background

  • As TREB has been reporting over the last year, the new City of Toronto Act gave the City the authority to levy other types of taxes, in addition to property taxes.
  • TREB strongly opposed the provincial legislation that gave this authority to the City. At the time, TREB warned the provincial government that the legislation could result in a second land transfer tax for Toronto property sales.
  • Specifically, TREB delivered this message directly to the Minister responsible for the legislation, the Minister of Municipal Affairs and Housing, in several meetings and detailed written submissions.
  • Also, TREB successfully raised the profile of this issue with significant media attention. However, despite the objections of TREB and other organizations, the provincial government moved ahead with this initiative.

Current City Actions

  • With the new City of Toronto Act taking effect on January 1, 2007, the City has moved quickly to consider taking advantage of its new taxing powers.
  • As mentioned, the City has begun this process with a discussion paper that presents all taxing options.
  • Most significant for REALTORS® is the option to impose a City land transfer tax on top of the existing provincial land transfer tax. While the discussion paper does not provide much detail on how a City land transfer tax would be implemented, it focuses on a rate of 0.5% on both residential and non-residential property transactions.

TREB Actions

  • Building on past lobbying against this tax at the provincial level, TREB has taken quick and strong action on this issue.
  • Specifically, TREB is working hard to convince City Councillors to oppose a second land transfer tax.
  • Soon after the release of the City’s discussion paper, TREB began meeting with City Councillors and sent an OPEN LETTER to Mayor David Miller, all of City Council, the City Manager, and the City’s Chief Financial Officer, clearly indicating TREB’s opposition to this tax.
  • In addition, a PRESS RELEASE, with a copy of the open letter was issued and generated significant media coverage.

Take just a few minutes of your valuable time to send an email to the Mayor and your City Councillor – it could save you thousands of dollars the next time you move… or it could set a precedent so that YOUR community will not implement this tax in the future!

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