http://m.thestar.com/#!/news/massive-property-tax-hike-forces-yonge-st-m...
This kind of stupidity is why we need a plan in this country to replace property taxes.
I prepose a mix of Reestate Speculation tax aka a tax on properties that are empty most of the year, absorbing proporty taxes into income taxes corporate taxes and creating a redistrubing formula back to Municiplatities based on a mixture of population and need.
The problem isn't with property taxes in principle. I'd say more of the problem stems from a federal and provincial tax system which has been deliberately manipulated to give coporations and the wealthy a free ride, and starve provinces and municipalities in turn.
I don't see how taking away the prime means of taxation municipalities and school boards have will help the problem. And a tax on empty property might seem good for dealing with ONE specific issue affecting some cities, but how would that work in places where there is actually a shortage of available property and a great need for infrastructure?
Fairer taxation generally, different rates like those which apply to farmers, and smarter policies to deal with the issues of development and speculation might be more in order.
Again... this isn't the result of a broken system; this is being done intentionally.
I'm not talking about the system starving although that's a problem, I'm talking about people who get hit by taxes so high its impossible for them to afford it, like the convience store owners, all because the property was assessed at what the city thought should be there and its possible resale value and not what was actually there. At the very least property taxes should be based on the income of the owner, not on the property value which basically inforces getthoization of the poor and throws people of a more modest income out of neibourhoods when property values raise higher then they're incomes. That just a way to clean out people to make room for richer people. It disgusting and mean.
i don't have much sympathy.....even though i own a small business...
many small business people voted to put or keep the psychopaths in power, and allow the sociopathic 1% to take even more, what did they expect would happen to them?
@ Brachina
Why do you think municipalities have been forced to drive up taxes in the first place? Transfer payments that used to provide a fair share of those income and corporate taxes have been reduced by governments that seem bent on destroying the federal system, and gearing everything to benefit the rich and corporations.
and @quizzical
Well how about farmers, and low income renters who get driven out by exactly the same thing? Or the situation in the states where regions which most oppose the social safety net are the places which most use its services.
Policy alternatives based on spite and vengance might seem satisfying in the short term, but that motive really just makes the problem worse. This is about more than how we assume certain people vote.
I could take the same approach about farmers who supported killing the wheat board, and are now left with a bumper crop in the bins and no way to sell it. That division only helps those created the problem.
We have similiar situations in Richmond when rapid transit came in. A large small business area is now destined for high density housing. The value of the land has skyrocketed, same with the taxes and the rent. Many non-profits are caught in this mix. As mentioned above the actual buildings and customers have not changed one iota, just the future uses of the land.
On one hand I think that there should be some allowance made for speculative value increases - not to let the landowners pocket even more of their winfall, but to provide relief to tennants many of whom have the property taxes (and increases) built into their rent.
On the other hand. This is where capitalism is supposed to figure it out. One would assume the rent was already at a level matching what the market can pay, raising rents will only force people to move to other areas. If landlords want tennants then they need to keep the rents at the right level and absorb the taxes against future redevelopment profits.
As for businesses that also own land that has skyrocketed in price and are having a hard time paying taxes, there is a yard sale at the United Church perhaps they can sell cookies...
As for businesses that also own land that has skyrocketed in price and are having a hard time paying taxes, there is a yard sale at the United Church perhaps they can sell cookies...
I'm sure the mega businesses that have deep enough pockets to pay those taxes and operating costs agree with you, and would love to see those in the middle class forced to sell at firesale prices.
We have had land prices double and triple here over the past 10 years. A much greater increase if you consider what has happened in the last 40 years. That might seem like a windfall, but it isn't necessarily the case if the only people who can afford to buy the property are those who want it for financial purposes, and are forced to jack up the rent accordingly. Or if someone who bought or built at 1960s prices now has to pay current rates. Doesn't matter how much your building is worth on paper if you can't generate the money to keep it running.
Believe it or not, there are plenty of people (like those being forced out in Toronto) who would actually prefer to see those buildings used for the purposes they were intended, not as some real estate gambling chip.
We have a prime corner here which is an empty lot for that very reason. When it's a multi-millionaire they can afford to sit on it until they can develop or sell to their advantage. That's not always the case for someone not so wealthy.
The increase in taxes is not driving the convenience store owners out – the increase in rent is. If the building owner did not think it could get higher rent from someone else, do you think it would have raised the rent so high? This is market forces not evil property tax increases.
Has the convenience store seen an increase in business as a result of the expansion in the neighbourhood? If so, why shouldn’t it see its taxes increase? The infrastructure that has benefitted the neighbourhood and the convenience store is not free. It is largely funded by tax dollars. There is nothing stopping the convenience store owners from opening up in a cheaper location. Meanwhile, the Yonge and Rosedale location will probably get a shiny new store with better prices and products than were offered in the old convenience store.
The TorStar has a small business love affair that results in unbalanced reporting. Businesses will come and go. Often the business that goes under was poorly run and poorly conceived. Sometimes a good business gets pushed out for wrong reasons. That may be sad but the solution is not to get rid of property taxes.
We need to reframe the tax debate and get peopel to realize that taxation is the price we pay for a civil society. Its pretty simple. But this has to start now! People like Sun News needs to be told to go to hell.
Not all forms of taxation are equal, some are good and fair and some are unfair.
Not all forms of taxation are equal, some are good and fair and some are unfair.
That was my point upthread. When everything is offloaded on local government, and when property values are inflated artificially, the resulting squeeze to simply pay for infrastructure results in unfair taxation.
But property tax is not inherently an unfair tax in the way that sales tax is.
And the notion of taxing vacant properties? How would that work in single industry towns that have their base ripped out from under them when the mill closes?Even in big cities much of the problem is dying and vacant city centres, while those in the suburbs are happy and booming.
The increase in taxes is not driving the convenience store owners out – the increase in rent is. If the building owner did not think it could get higher rent from someone else, do you think it would have raised the rent so high? This is market forces not evil property tax increases.
My point would be that sometimes the systems that accountants design sometimes develop a life of their own. Just to go a bit more in depth about my city as a case in point.
When Richmond chose to build the Olympic Oval it also decided to redevelop a major tract of land (the Brighouse Properties). The spillover is that the industrial land adjacent to it was redesignated and is now destined for high density. The value of these lands instantly went through the roof and so did the taxes. Many of the current rental agreements are based on rent plus utilities plus taxes leaving the tennant shouldering any change. Now you could say that landlords should look at the millions down the road and drop the rent to cover the increase in taxes, but that involves calling a dollar a dollar, where accountants have a bunch of different ways to refer to a dollar each with its own accounting spot. The problem is exasperated by companies or the companies that end up owning them and look at these properties chiefly as redevelopment projects and tenants as headaches. Then you are left with areas with high vacancy, low maintenance.
Also as noted above there are the people with the $500K property that just became worth $750K. Yes they have trouble paying higher taxes, but there are lots of ways to get around it. Do what Rona and others have done. Sell the property with a negotiated long term lease. Business people almost by definition are buying into the market system, so they need to learn to live with the difficulties. Personally I wish I had the difficulty of my net worth increasing so much that it was making my taxes hard to pay on my current salary.
As for vacant industrial properties. I look as their taxes as a fish or cut bait tax. If you don't want to do something productive, get out of the way and let someone else have a try. Similiar to the Capital Tax that was on in BC.
We should have a thread about taxes. Somewhere that I could promote my favorite - a progressive expenditure tax. Something that taxes waste and extravagence, and rewards thrift and efficiency.
When everything is offloaded on local government, and when property values are inflated artificially, the resulting squeeze to simply pay for infrastructure results in unfair taxation.
i see your point. i didn't think far enough. the seniors in Vic are struggling to pay taxes on their fixed incomes.
But property tax is not inherently an unfair tax in the way that sales tax is.
i think i need to know more about unfair and fair taxes. i'd never thought beyond "all taxes are unfair".
And the notion of taxing vacant properties? How would that work in single industry towns that have their base ripped out from under them when the mill closes?
they tax vacant properties here. and the mill is closed and taken away...
Even in big cities much of the problem is dying and vacant city centres, while those in the suburbs are happy and booming.
this is a naturally occuring process in cities since maybe their earliest formation. i don't see it as a problem.
@ quizzical
My vacant property point was a response to the proposal upthread that taxes should be focused more on properties that are bought and left idle. I agree it's a serious concern (I forget the percentage of housing properties in Vancouver which are actually vacant, but it is staggering). I don't think it woudl work as a tax strategy because it would hurt those owning vacant properties in depressed areas (even more than they already are because, as you correctly point out, they are taxed just like every other property).
i think it's a 2 edged sword. a win and a loss.
vacant properties get taxed here and when the owners can't or won't pay taxes the village gets them. they just had a huge tax sale last year i think and did well. sadly the tax payers didn't get the break, the mayor, council and some staff sent themselves to the UBCM and stayed in 500.00 a night rooms for over a week.
the village also gets garbage, sewer and water fees from the owners of the vacant lots. the property tax payers have a cushion of better services by the village not having to actually service the property.
and now there's a huge scandal brewing over some Ontarian company (GITC) with Kuwait ties buying up, or allegedly buying, all the vacant and for sale property here. i tell ya we got it all going on.......
Interesting village.
As for taxes its all in how you designed them, if you put in fair tax breaks and so on based on senible and responsible reasoning and not just on goofy stuff like hockey equiptment, but for those that really need it, we can have a fairer and more productive tax system.
Property taxes are a terrible form of taxation for several reasons.
First, the value of one's property often bears little relation to their income or ability to pay high taxes. Someone may be low income or on a pension or something but have property that's valuable. That doesn't make them rich. They don't realize the value of that property until they sell it. So there are plenty of seniors who bought a home decades ago at a reasonable price and now the neighbourhood suddenly becomes trendy and the property rises in value. Often at the same time as their income goes down cause they're now retired, so they get pushed out cause the taxes are unaffordable.
Second, I tend to think that the taxes you pay ought to, in some way, reflect the costs that you are imposing on society. However, with property taxes, this is often reversed. So somebody who lives in a multi-million dollar home in a neighbourhood in Toronto like Rosedale will pay way more in property taxes than will someone in a much less expensive house out in the suburbs. But the infrastructure in Rosedale has already been built. Assuming they work in Toronto, it's a short commute. Whereas the house in the suburb required huge investments in new infrastructure, maybe it involved tearing down a forest or paving over farmland and the people who live there are probably gonna have long commutes, during which time they'll be clogging the roads and spewing emissions into the air. But by making that the cheaper option, the government is, in essence, encouragin urban sprawl and environmental degradation.
Yes, but most people use a bit more than just the street in front of their house. And one could make the argument that people without kids shouldn't pay school taxes at all, but that's not how it works.
Fact is, aside from raising fees, fines and gas taxes, the mill rate is all that municipalities and school boards have. And local governments and agencies have even less now that provincial governments have completely taken over the lottery and gambling systems that used to be local. As I also said, this has less to do with the nature of the tax than the fact that this is the result of higher levels of government starving municipal governments.
As one example, once people no longer qualify for EI, who winds up holding the bag for welfare payments?
So unless we're talking about a municipal income tax (which, added on to what we already have, is patently absurd) we pretty much have to work with what we have.
