A recent report has discovered that the people of Ontario do not want municipalities to have greater tax powers.
The Ontario Real Estate Association commissioned a study, conducted by Navigator, to better understand the Public Perception Regarding Municipal Government Programs. The online survey included people aged 18+ in Ontario.
Approximately 70% agreed that more could be done by municipalities to find savings and control spending. This percentage may sound high, but we’re actually surprised it’s not higher. Isn’t there always more that can be done to improve budgeting?
Only one-third felt that municipalities should have greater tax powers. Some municipalities have hinted at creating a municipal land transfer tax, which would be in addition to the provincial LTT. Currently, the only municipality with an MLTT is Toronto.
For example, a $600,000 home in St. Catharines would cost $8,475 in LTT. If you bought the same priced home in Toronto, you’d pay $16,950 (LTT and MLTT). This obviously contributes to the cost of buying a home. LTT and MLTT can’t be lumped into the mortgage - it’s due upon closing, so you need to actually have this money in the bank.
OREA has been against the introduction of an MLTT in other municipalities in Ontario because it will undoubtedly slow sales activity.
“In the past, some municipalities have asked for the ability to implement a municipal land transfer tax upon home purchases, or a new sales tax. Municipal governments have a responsibility to their residents and should first and foremost be looking to make better use of their resources before deciding implement (sic) new taxes,” says Tim Hudak, CEO of OREA. “Burdensome new taxes like the unfair MLTT only add to the existing red tape and regulation standing between young families and the Canadian dream of home ownership.”
With regards to property taxes, just one-third of homeowners said that they believe the annual property tax increases in their community have been fair and reasonable. That means the majority of homeowners in Ontario feel they’re paying too much in property taxes. If this is the case, an MLTT would not be welcomed with open arms.
When it comes to spending, the majority believed that firefighting, garbage/waste disposal, and police services were making efficient use of government funds, but only 40% felt that local school boards and municipal roads were making good use of taxpayer money.