Municipal land transfer tax won't be allowed to expand past Toronto
Published Tuesday, December 1, 2015 12:21PM EST Last Updated Tuesday, December 1, 2015 2:32PM EST
TORONTO -- The 444 municipalities spanning Ontario will not be given the same power as the city of Toronto to impose a local land transfer tax.
Municipal Affairs Minister Ted McMeekin surprised the Opposition during question period Tuesday by announcing the Liberal government would not allow towns and cities to impose their own land transfer tax on top of the province's.
The province did its usual consultations on the Municipal Act following last year's local elections and found "no one was asking" for a land transfer tax, McMeekin told the legislature.
"We are currently reviewing that feedback and can tell you there has been no call, at all, for a municipal land transfer tax, nor is there any legislation before the house that would allow this," he said. "Let me be clear: there will be no extension of the ability to have a land transfer tax to any municipality (outside Toronto)."
The Progressive Conservatives celebrated after McMeekin's surprise announcement, but also accused the Liberals of floating the land transfer tax as a trial balloon.
"It just recognizes some of the concerns that municipalities have," said deputy PC leader Steve Clark. "I'm glad the minister made the right decision."
The Tories claimed the municipal land transfer tax has already cost Toronto up to $2.3 billion in lost economic activity and 15,000 jobs, but there are no indications it has cooled down the city's real estate market.
McMeekin accused the Tories of using scare tactics to warn people that a land transfer tax would hurt home sales, and said he wanted to make it clear that the province was not imposing such a plan.
"There was a campaign of misinformation there and it just made sense in the house, to me, that I stand up and clarify and that's what I did," he said.
Cash-strapped municipal governments are looking for new revenue tools, added McMeekin, who suggested some may want to follow Toronto's lead and impose development charges.
"That's a potential significant source of revenue," he said. "They have certain tools that many of them use wisely, but some aren't using fully."
The Opposition said McMeekin should come up with some solid ideas and suggestions for local governments to help them increase their revenues.
"The minister cannot continue to float trial balloons up to municipalities," said Clark. "He needs to actually have a meaningful consultation with them and table some of his suggestions so they can have that discussion."
Clark said the Liberals only backed down because of his private member's motion -- which was scheduled for debate Thursday -- that said the government should not impose or help municipalities facilitate the imposition of a land transfer tax.
"Until I tabled the motion, which put it in the public realm, they would have continued doing what they've been doing and talking behind closed doors," he said. "It's not the way to consult."
The Ontario Real Estate Association called McMeekin's decision a "huge win" for people who dream of home ownership.
"It reaffirms that the municipal land transfer tax is a bad revenue tool, not just outside Toronto but in it as well," said OREA president Patricia Verge.