Mayor Rob Ford is pushing to cut Toronto’s land transfer tax by 10 per cent as soon as possible, a move that could take more than $30-million out of the city’s coffers.
Mr. Ford is asking for a staff report on his proposal by July, promising to put it on the council agenda as soon as possible.
“I’ve said we are going to do it. We have to start moving on it,” Mr. Ford said during a meeting of his executive committee Wednesday. “Let’s put it on the floor of council and have the debate.”
Mr. Ford promised to scrap the tax during his campaign for mayor. Putting it before council as it gears up for the next election allows him to claim he took action whether or not his proposal gets council’s backing.
“It won’t be a boring summer, that’s for sure,” he predicted after the committee endorsed his request.
The debate is bound to be controversial, with several councillors, including executive committee member Councillor Paul Ainslie saying any talk of cutting the tax must include a discussion of what services would be affected by the loss of revenue.
Mr. Ainslie said he did not support the tax when it was introduced, but wonders how the city, which spends most of budget on salaries, will offset the lost revenue. “We are going to have to look at reducing services or programs, and if we don’t, you transfer that money onto the property tax,” he said.
Councillor Shelley Carroll, a former chair of the budget committee under the last administration, fears a cut in the land transfer tax will shift the burden onto vulnerable groups such as elderly homeowners who are already struggling to pay property taxes.
Councillor Gord Perks said it will be hard to convince other area local governments to join the city in any new tax to support transit if Toronto is busy cutting its own taxes. “Clearly he is not serious about healthy finances for the City of Toronto, ” he said.
The mayor made it clear he wants the city to make up for the lost millions in revenue by cutting costs, not increasing other taxes.
“I think the budget chief and the city manager are going to have to start rolling up their quarters,” he said. “We are going to have to start finding the efficiencies down here.”