In 2005, Toronto Council adopted a 15-year plan to correct the imbalance in property class tax allocations between the 416 and 905 (Enhancing Toronto’s Business Climate – It’s Everybody’s Business) with the goal of reducing tax inequalities and promoting office development in the downtown core. A tax ratio target of 2.5:1 between commercial and residential tax rates was set to be implemented by 2020 or earlier.
The Toronto Association of Business Improvement Areas (TABIA) including the Toronto Financial District BIA as a member have approved the same position to continue lowering the commercial-to-residential tax ratio to 2:1 by 2025. This position is built on a Backgrounder prepared by economists from the University of Toronto and Trent University
As part of its 2016 revenue tools and long-term fiscal direction reporting aimed at long-term solutions to decrease the City’s capital funding gap, City Council in 2016/17 endorsed a deceleration of these commercial rate reductions. With this update, the BIA has begun requesting that long-term timetables be provided each year showing when the reductions will be back on track and when they further reduction targets will be met.
OUR POSITION: The City of Toronto must stay committed to reducing the commercial-to-residential tax ratio to 2.5:1 by 2020 and continue dropping to 2:1 by 2025. A timetable must be shown by the City each year to show when ratio targets will be reached.
Updated January 31, 2017