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Glen said:
NB. Chris Brown speaks only for Oshawa. That does not explain why all the other municipalities listed have considerably higher property taxes. Also missing from the the stats is the corresponding municipal spending. The principal of municipal taxation (somewhat lost) is that local taxes are to pay for local services.

In this context lets compare Toronto to Mississauga/Peel. 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 ($2800 avg.) than the average household in Toronto ($2279 avg.) and gets $ 4,573.71 less in services.

Toronto's average residential property tax represents only 27% of the cities spending. In Mississauga/Peel residential property tax represents 72% of spending. Mississauga also has much higher user fees.
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There never is an easy answer but cities are always balancing the collection of taxes from residential and commercial properties. On balance, the general feeling is that Toronto overtaxes commercial properties and under taxes residential......thus the theory that many office developments are headed to the 905.

Obviously can't speak for all municipalities but as a Bramptonian who reads the city;s annual report....they made a concious decision years ago to target having their industrial/commercial tax rates amongst the lowest in the GTA in the hope of attracting that sort of development.....the theory being that lower taxes are better than no taxes (and the jobs ain't a bad thing to have).

I guess my point is that it is impossible to simply look at one city's residential rates in comparison to anothers is not looking at the entire picture.

g
 
Those articles are misleading, as they compare houses of the same value, rather than houses of the same size, or lots of the same size. The end results is that you end up with a $400,000 house paying less tax in the suburbs, however you've got something win the suburbs with a 50' lot and 2,500 square feet, but the city house is on a 20' lot with only 900 square feet.

Surely if you've got a tiny lot, you have much denser housing, and it is a lot cheaper to service (less distance for garbage collection to drive, less sidewalk to construct, less road to build/clear. Cheaper to provide public transportation).

A fair comparision would be to examine the taxes paid on lots/houses of equal size. Or to determine what the median tax rate is, and compare it.
 
nfitz said:
Surely if you've got a tiny lot, you have much denser housing, and it is a lot cheaper to service (less distance for garbage collection to drive, less sidewalk to construct, less road to build/clear. Cheaper to provide public transportation).
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It's really hard to do these kinds of comparisons, because property tax rates are set municipality-wide based on the total budget requirements and the available assessment. Nowhere is the cost of servicing any particular neighbourhood part of the calculation - it is all averaged out.

Toronto gains because it is denser overall than 905 municipalities, so more properties share in the costs and because it has a healthier commercial tax base that can take more of the costs. But at an individual neighbourhood level, density simply doesn't matter - only the cost of the property does.

Perhaps property taxes should actually be based partially on density so as to encourage more dense development (e.g. charge less for a $400K townhouse than a $400k 2500 sq ft detached house in the same municipality). Personally, I'd like to see a base property tax based on property/house size to cover municipal services that do vary by property density, and then cover the rest of the budget with a local income tax administered by the province.
 
nfitz said:
Those articles are misleading, as they compare houses of the same value, rather than houses of the same size, or lots of the same size. The end results is that you end up with a $400,000 house paying less tax in the suburbs, however you've got something win the suburbs with a 50' lot and 2,500 square feet, but the city house is on a 20' lot with only 900 square feet.
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They are not misleading. They merely reflect the reality that by attempting to make property tax 'progressive' the expense of such gets reflected in the value. You cannot conveniently dismiss supply side economics when it suits you. Otherwise you should be arguing that all housing should cost the same in a given region, with no premium paid for location. Should sales tax on a $10 T shirt be same as a $100 dress shirt?

Surely if you've got a tiny lot, you have much denser housing, and it is a lot cheaper to service (less distance for garbage collection to drive, less sidewalk to construct, less road to build/clear. Cheaper to provide public transportation).
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Most of the big ticket items in the budget do not scale well with density. So there is little savings to be had. Hemson Consulting did a report which adjusted municipal expenditures based on location density. While it was done for office towers, it methodology is relevant for this discussion.........

http://designersi.com/users/12415/downloads/r_officetower_rev_cost.pdf

A fair comparision would be to examine the taxes paid on lots/houses of equal size.
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Nope, as per above. A 'fairer' way wold be for the city to determine what it cost to service residents based on actual cost and tax accordingly. Of course that would remove any progressive nature out of the equation, and is not what I am suggesting.
 
Glen said:
Most of the big ticket items in the budget do not scale well with density. So there is little savings to be had.
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I'd argue that the residential tax portion of the city's income isn't there to pay for the big ticket items. That should come from other sources of income, such as the car tax, real estate tax, business tax, etc.
 
nfitz said:
I'd argue that the residential tax portion of the city's income isn't there to pay for the big ticket items. That should come from other sources of income, such as the car tax, real estate tax, business tax, etc.
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FYI. Here are Toronto's top 10 expenses, in order.

Police 24.4%
Debt Service charges 12.2%
Fire Services 10.4%
Social Services 7.9%
Shelter Support & Housing 8%
TTC 7.4%
Parks, Forest & Recreation 7%
Transportation Services 5.7%
Solid Waste Management 5.7%
Toronto Public Library 4.6%

That is 93% of the total operating budget.
 
Glen said:
FYI. Here are Toronto's top 10 expenses, in order.

Police 24.4%
Debt Service charges 12.2%
Fire Services 10.4%
Social Services 7.9%
Shelter Support & Housing 8%
TTC 7.4%
Parks, Forest & Recreation 7%
Transportation Services 5.7%
Solid Waste Management 5.7%
Toronto Public Library 4.6%

That is 93% of the total operating budget.
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Where does municipal roads fit into the equation?
 
TOareaFan said:
It is seldom a good thing when your second highest expense is debt service!
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Thank the unions, a spineless city hall, and city councillors who have no sense of budgeting....and a province that would rather balance its books than help communities.
 
kEiThZ said:
Thank the unions, a spineless city hall, and city councillors who have no sense of budgeting....and a province that would rather balance its books than help communities.
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Well, to be fair, the province is quite fiscally challenged. It has a pretty high debt level, fairly high taxes within the context of the federation, and not a lot of fat to cut from the budget after the Harris years.

In other words, it can't really run a deficit, raise taxes or cut spending in a significant way. Given that in this situation, the government proposed MoveOntario 2020 is pretty impressive.
 
The McGuinty has also managed reverse some of the downloading onto municipalities that Harris government made.
 
afransen said:
and not a lot of fat to cut from the budget after the Harris years.
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Its the government. There is never a shortage of fat to cut.
 
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