City council has voted in favour of a two per cent residential property tax hike that will cost the average homeowner about $96 more per year once a number of other levies are factored in.
The increase, which is roughly in line with the rate of inflation, was approved following an exhaustive debate at city hall Wednesday afternoon.
In the end, council voted 35-8 in favour of the Mayor Tory-backed two per cent increase.
A separate motion from Coun. Gord Perks to raise property taxes by 4.26 per cent was defeated 32-10.
Another motion from Giorgio Mammoliti to freeze property taxes in 2017 was also defeated 40-2.
The approved property tax hike amounts to an extra $69 a year on a property with an assessed value of $587,471, however that number rises to $96 when you factor in a number of levies, including a 0.5 per cent levy to pay for the Scarborough subway extension and a 0.5 per cent levy to pay for Tory’s so-called “City Building Fund,” which will be put towards transit and housing.
In a news release sent out following the vote, Tory said the approved increase is one that “council can be proud of.”
“I was elected on a mandate to keep property tax increases at or below the rate of inflation and I will keep that promise. As much as some will say they want to pay more, the majority of Torontonians voted for candidates who called for strict discipline on property tax hikes,” Tory wrote. “This tax rate has been attacked by those on the political left and those at the fringes of council's right. That tells me it's just right – it is a moderate tax rate that moves this city not left, not right but forward.”
Toronto has the lowest property tax rate in the GTA and in recent weeks a number of councillors had pushed for a higher increase that would have allowed the city to pump more money into social programs.
Mammoliti, meanwhile, said the two per cent increase was too high and was an example of Tory “taking the easy way out” rather than taming the city’s ballooning budget.
Speaking with CP24 earlier in the day, the outspoken councillor said that Toronto needs to have discussions with the province about taking over the operation of the TTC and the Gardiner Expressway, among other things.
"The resistance is that nobody wants to do the hard work," he said. "This is the easy way out, just to tax everybody."
Toronto's residential tax rate in 2016 was 0.0070. In comparison, the rate in Mississauga was 0.0087 and in Whitby it was 0.01294.
“We are trying to provide a very fair, affordable and balanced budget to the residents of the city and I think that is what you are seeing here,” Budget Chief Gary Crawford told CP24 earlier on Wednesday. “We are looking at key priorities like increasing childcare, increasing student nutrition and poverty reduction but we also have to be incredibly fiscally responsible with the money and be accountable to the residents with how we are spending it.”
Council needs to trim millions from budget
At today’s meeting, councillors heard presentations from staff on the $12.3 billion operating budget and the $39.7 billion, 10-year capital budget.
City council also began the process of finding a way to trim between $8-million and $10-million in spending from the operating budget in order to balance it. That number is significantly lower than the $731-million deficit that existed at the outset of the budget process and the $91-million shortfall that existed as recently as last month.
Speaking with CP24 during a break in the meeting, Deputy Mayor Denzil Minnan-Wong said he believes the budget is “fair and reasonable” despite calls from some to introduce a property tax increase over and above the rate of inflation.
“Some of these councillors on the left believe taxing is a virtue and they would like to raise the tax rate much higher. I disagree with that,” Minnan-Wong said.
Council is expected to finalize the budgets on Thursday as they wrap up a two-day meeting at city hall.