Chow says she would boost land-transfer tax on expensive homes

Share

Toronto mayoral candidate Olivia Chow is vowing to raise the land-transfer tax on high-end homes as a way to pay for transit and school nutrition programs.

Ms. Chow's announcement on Tuesday morning that she would increase the land-transfer tax on homes over $2-million by one percentage point, from 2 per cent to 3, was her first mention of raising taxes since launching her election campaign in March. It also comes after recent polls show her support lagging behind John Tory and Mayor Rob Ford as the race enters its crucial final stretch.

"Surely those people that can afford $2-million or $10-million homes, adding 1 per cent to the land-transfer fees I don't think is too much," she said. "I think it's fair. It's progressive."

Ms. Chow is proposing to use the $20-million she says the tax hike would raise, and invest it in child nutrition programs in schools, as well as the Toronto Transit Commission. In particular, she said, the funds could go toward engineering studies for building a downtown relief subway.

"I think people that are progressive will agree with me – that if it means 36,000 kids can have good food in the morning … I think the majority of people in the city will say, 'Yes, this is the way to go.'"

Currently, the same 2-per-cent rate is used to calculate land-transfer tax for all homes in Toronto that cost over $400,000 – meaning tax on a $2-million home would currently cost about $40,000. Ms. Chow's one-percentage-point hike would raise that to about $60,000.

Since entering a race crowded with centre-right candidates, the former NDP MP has avoided mention of raising taxes, and has promised to keep property taxes at the rate of inflation.

But she denied on Tuesday that her announcement signified a shift toward the left. "I am clear in where I stand. I do not waver," she said. "I know my values are shared by the majority of people in the city."

She also pointed to her vow to scrap plans for a Scarborough subway and instead build above-ground light rail transit as an example of her continued commitment to "minding the public purse."

The Tory campaign was quick to slam Ms. Chow's announcement, and accuse her of pandering to her base.

"What we're seeing here is evidence of Olivia Chow's hard left turn, in an effort to appeal to her NDP base and revive her floundering campaign," Tory spokeswoman Amanda Galbraith said.

Mayor Ford's campaign spokesman, Jeff Silverstein, attacked Ms. Chow's proposal as well – but also took shots at Mr. Tory.

"At least voters know with Olivia Chow what they will get. She's open about her tax and spend agenda," he wrote in an e-mail. "When it comes to John Tory, he has consistently flip-flopped on key issues like the downtown relief line and his funding plan leaves more questions than answers on how he will pay for his initiatives without hiking taxes."

And the Soknacki campaign pointed out that Ms. Chow's proposal would not address the issue of rising home prices and taxes.

"Ms. Chow doesn't seem to care that home prices are rising, but transfer tax brackers aren't rising to compensate," he said in a statement. "So her plan will actually make this tax more regressive over time."