Friday, April 25, 2008

Death by fire, then death by taxes.

Small Business facing $75,000 increase in taxes

Dukes Cycle, long a fixture on Queen St. West, after being destroyed by fire is now threatened with destruction by taxes. Because the building has been in the Dukes family's ownership for a long time, its taxes were based on old assessment. According to the Globe and Mail, they were currently paying $15,000 per year. If that property was was to be rebuilt it would have to pay the new rates. $90,000 per year!

Anyone who has been to Duke's would shake their head and wonder how they, or any other small business can afford to operate in Toronto.

While the city talks about helping small businesses, fifteen year, now seven year plans, it is still to little.

Even at the end of the tax reduction plan they still face a tax bill huge tax bill. It is funny how Toronto wants to stop Walmart from building in the city while at the same time having a tax climate that only such large stores can afford. I would even go so far as to say that the high tax burden has some benefits for such large stores. By helping kill off small businesses and limiting competition they have the market to themselves.

While local councillor Adam Vaughan, is working on an abatement for Duke's what about all the rest of the city?

Tuesday, April 1, 2008

Wow what a difference !

While the three post blow this detail how much less tax Toronto residents pay than their neighbours, this one will look at how much more the city spends per household.

Using 2006 data from the Municipal Performance Measurement Program it shows that Toronto spent $8,422 per household in 2006. On the other hand Mississauga and the region of Peel combined, spent $3,848.29 per household.

So the average household in Mississauga pays more than $500 per year in property tax than the average household in Toronto and gets $ 4,573.71 less in services.

While property tax is only one source of revenue for cities, it is the largest. Cities also receive User Fees and Provincial grants. Note though that user fees are also higher outside the 416 area.

If you don't live in Toronto but do in the 905 region, perhaps you should call your MPP and demand equal subsidisation from the Province

Taxes hit you where you live

The article linked to in the headline is self explanatory.

A cool tool from the Star

Property tax calculator

Royson James looks at TO's Property tax

Royson James of the Toronto Star has had a look at The artificially low tax rates paid by Toronto's residential taxpayer.

and a follow up piece

Below are some quotes from the two......

Toronto homeowners just may be the most pampered, tax-sheltered, spoiled-rotten ratepayers in the GTA.

The owner of a $380,000 home in Pickering pays $4,270, while the Bramptonian pays $3,729 and residents of Markham, Mississauga or Vaughan pay more than $2,922.

Toronto's neighbours wonder how Mayor David Miller can cry poor but refuse to tax Toronto homeowners at rates comparable to their municipal cousins.

Using comfortably tortured logic, Miller gets away with it. First he says Toronto homeowners can't afford higher property taxes so he must find other revenue sources, like the land transfer tax. But when critics say that will dampen the housing market, he argues that Toronto taxes are already low so the new taxes shouldn't hurt.

Apparently, the truth hurts – even where it might be celebrated.

How else to explain the outcry over yesterday's Star story that show property taxes are a sweet little deal for Toronto homeowners, compared with other GTA cities and towns.

A $380,000 home pays $5,745 taxes in Oshawa, $3,729 in Brampton and $2,322 in Toronto, the figures show.

Employing another measure used by each city – the average assessed home – the disparity remains. The average Richmond Hill home at $400,000 pays $3,169; the average Toronto home at $369,300 pays $2,256; and the average Oshawa home at $275,000 pays $4,157, almost twice the Toronto amount.

So all the arguments about small lot, big lot, number of bathrooms, amenities, urban sprawl, densities, cost to provide service, and others don't account for the discrepancy. Pick any benchmark house price and Toronto is low. Take the average home, and Toronto is low.

Setting aside comparisons with other GTA municipalities, the Toronto homeowner pays property taxes at a rate four times lower than Toronto tenants and business. Businesses don't vote and protest and write letters to the editor and cry over every percentage of tax hike; they vote with their feet and leave, if they can.