December 15, 2011
Mayor Rob Ford vowed Thursday to start eliminating the city’s land transfer tax next year.
“We’re going to be tackling that (in 2012),” Ford said. “I campaigned we’d get rid of it by the end of my term and if we do it in pieces, we’ll do it in pieces, but I’m going to keep my promise.”
The land transfer tax, introduced by former mayor David Miller, is expected to generate around $300 million in revenue this year. If Ford cut the tax by 25% next year, the city’s budget mandarins would have to find an extra $75 million in revenue to replace it or cut $75 million in city spending.
Councillor Gord Perks shook his head at the mayor’s proposal to axe the tax.
“A year ago the mayor said we had too much money and cut the vehicle registration tax then he said we didn’t have enough money so we had to cut programs now he said we have too much money again, I wished he’d just read the city’s books.”
“Somebody with this financial attitude shouldn’t even be allowed in City Hall, let alone in the mayor’s chair,” Perks added.
Budget Chief Mike Del Grande said eliminating the land transfer tax wasn’t part of the 2012 budget discussion.
“I’m focused on this budget,” he said. “That issue never came before me, not for 2012.”
But Del Grande pointed out the approximately $300 million in revenue from the land transfer tax could dry up if the city’s housing market cooled down.
“That could disappear overnight and there is no back-up for that,” he said.
“Right now it is saving our bacon, it is a nice cash cow … but there is no reserve to backstop us.”
Councillor Josh Matlow predicted Ford won’t have the votes on council to start to eliminate the tax next year.
“His timing is incredibly poor given the fact that despite having the $300 million revenue from the land transfer tax this past year, council is struggling to balance the budget while protecting the services that Torontonians value and rely on,” he said.
The St. Paul’s councillor stressed he doesn’t like the land transfer tax and thinks it should be dropped eventually.
“It needs to be demonstrated how we are going to replace that revenue without making unnecessary cuts to services,” he said. “We shouldn’t simply just throw away $300 million.”
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