THE CITY: Shaving land transfer tax a serious...
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Feb 21, 2013  |  Vote 0    0

THE CITY: Shaving land transfer tax a serious fight

Scarborough Mirror

Barring anymore run-ins with the law, it looks as though Mayor Rob Ford has at least one serious fight ahead of him as he attends to the last two years of his term: the land transfer tax.

The mayor has made it clear he would like very much to shave 10 per cent off the tax on real estate transactions. The plan is a dilution of his 2010 election promise to scrap the tax entirely – something even the tax-cutting Ford soon realized would be financially impossible. The tax brings in in the neighbourhood of $350 million a year, and since Ford’s predecessor David Miller introduced it, has become a crucial element in balancing the budget.

The 10 per cent cut, on the other hand, is a battle the mayor might conceivably win. Held against budgets that run in the neighbourhood of $10 billion, $35 million can exist in a margin of error – and such a cut would just be added into the other pressures the city’s budget committee and council have to deal with each year.

The real battle will be convincing council to support adding that $35 million to the tally. Ford’s former budget chief Mike Del Grande, as staunch a fiscal conservative as the mayor in most respects, was deeply skeptical about the plan. His replacement, Frank Di Giorgio, is comparatively cheerful at the prospect of at least looking. But he’s unwilling to make any cut to the tax without finding some offsetting revenue.

And the rest of council? Over the past three budgets, council as a whole has been unwilling to follow the mayor and his agenda too far down the road to privation. With an election coming up, will 23 councillors jump onto the land transfer tax bandwagon as readily as they did in 2010, when they supported the freshly-elected mayor’s plan to scrap the vehicle registration tax?

There’s very little percentage that they will do so. Unlike the vehicle registration tax, which all car-driving voters had to pay every year they continued to own a car, the land transfer tax is relatively invisible. Property-holding Torontonians pay it every time they move house. But that tax is rolled into other costs of buying and selling and moving – and once the move is done, the tax doesn’t rear its head again until the next move.

Which means for most Torontonians in the 2014 election, it won’t be top of mind.

Given that, shaving 10 per cent off in the 2014 budget will take an enormous amount of political capital from the mayor’s office – more than David Miller used to get it installed in the first place.

It may take all that Ford has at this point in his mandate. It will likely take even more.

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