Property Tax Policy
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Enhancing Toronto’s Business Climate
The City has tax policies to enhance Toronto’s business climate over the long term. This includes Council’s policy to reduce the tax ratios for the multi-residential class and the business class to 2.5-times the residential tax rate by 2020 with accelerated reduction rates for small businesses, with a target of 2.5-times the residential rate by 2015.
For 2017 tax year, the Province legislated a freeze on the multi–residential property taxes, and City Council adopted a policy of 1/2 of residential tax increase for commercial and 1/3 for industrial properties. These policies resulted in a revised target date to achieve the 2.5 tax ratio for business properties from 2020 to 2023.
Other City efforts to enhance competitiveness have resulted in a successful agreement with the provincial government to reduce business education tax (BET) rates for the City of Toronto businesses closer to the average of the surrounding GTA municipalities, creating a new, fair water rate structure for industrial and manufacturing companies and continuing the relief of development charges for the city’s commercial industry.
- 2017 Property Tax rates and Related Matters
- Enhancing Toronto’s Business Climate – Update Staff Report, June 2007
- Enhancing Toronto Business Climate – It’s Everybody’s Business, Report, July 2005
- Enhancing Toronto Business Climate, Attachment 1, July 2005
Vacant Homes Tax
The Province of Ontario recently introduced legislation that would empower the City to introduce a tax on vacant residential units, encourage property owners to sell unoccupied units or rent them out, and address concerns about residential units potentially being left vacant. The City conducted public consultation on the implementation of a vacant home tax in the fall of 2017.
- Public Consultation Results and Update – Vacant Home Tax, April 2018
- Implementing a Vacant Home Tax in Toronto, June 2017
Municipal Accommodation Tax
The City of Toronto is implementing a four per cent Municipal Accommodation Tax (MAT) on all hotel accommodations within Toronto as of April 1, 2018 and short-term rentals on or after June 1, 2018 (pending the enactment of the short-term rental bylaw).