The City of Toronto is supporting small businesses by increasing the discount the Small Business Property Tax Subclass provides from 15 per cent to 20 per cent on the municipal portion of commercial property taxes, a key measure helping lower costs for 28,000 local businesses across the city.
At an event held today at Mezes Restaurant on the Danforth, Mayor Olivia Chow was joined by Councillor Paula Fletcher (Toronto–Danforth); Tony Pethakas, Chair of the Greektown on the Danforth BIA and owner of Mezes; and John Kiru, Executive Director of the Toronto Association of Business Improvement Areas (TABIA), to underscore the City’s commitment to small business affordability, and supporting local jobs and community vitality.
Toronto is a city powered by small businesses. More than 95 per cent of Toronto businesses employ fewer than 100 people, together supporting nearly one million jobs, or 53 per cent of all employment citywide. The city is also home to more than 10,000 restaurants and dining establishments, many of them concentrated on main streets.
Small Business Property Tax Subclass
Earlier this month, Toronto City Council approved an increased reduction to the Small Business Property Tax Subclass. The Province of Ontario has confirmed it will match the City’s increase for the education portion of property taxes. In total, about 63 per cent of all commercial properties in Toronto are eligible for the subclass, delivering meaningful, ongoing savings to thousands of small businesses.
The Small Business Property Tax Subclass was first adopted by City Council in 2021 and came into effect in 2022. Since its launch, it has provided a combined municipal and provincial tax reduction to eligible properties. The newly enhanced benefit is a key action under the City’s Action Plan for Toronto’s Economy (https://www.toronto.ca/city-government/accountability-operations-customer-service/long-term-vision-plans-and-strategies/action-plan-toronto-economy/), which is focused on affordability, resilience and inclusive growth.
More information about the Small Business Property Tax Subclass supports is available on the City’s website: https://www.toronto.ca/services-payments/property-taxes-utilities/small-business-property-tax-subclass/
Additional supports for small businesses
In addition to property tax relief, the City supports small businesses through a range of complementary programs, including:
More information about the City’s wider business supports is available on the City’s website: https://www.toronto.ca/business-economy/business-operation-growth/business-support/.
Quotes:
“Through the 2026 budget, the City of Toronto is lowering Small Business Property Taxes by increasing the Small Business Property Tax Subclass to 20 per cent. Small businesses are the backbone of our economy and our neighbourhoods. This change puts real dollars back into the hands of local business owners, helping them manage rising costs, protect jobs and continue serving their communities.”
– Mayor Olivia Chow.
“Strong main streets are essential to Toronto’s economy, which is why I brought forward the motion to increase the Small Business Property Tax Subclass to 20 per cent. This targeted tax relief supports small businesses across the city and provides greater stability during ongoing economic pressure.”
– Councillor Shelley Carroll (Don Valley North), Mayor’s Economic Development & Culture Champion
“Small businesses are vital to Toronto’s economy and the beating heart of neighbourhoods like the Danforth. This enhanced tax relief will help small businesses continue to thrive, create local jobs and make our main streets vibrant, dynamic spaces for residents and visitors to enjoy.”
– Councillor Paula Fletcher (Toronto–Danforth)
“Toronto’s main streets are powered by the vitality of neighbourhood businesses, and this enhanced tax relief is a meaningful step toward helping them remain competitive and resilient. TABIA welcomes the City’s continued commitment to listening to the needs of local business communities, reducing barriers and creating conditions through new and ongoing programs where small businesses can invest, grow and continue contributing to the economic and social well-being of all our neighbourhoods. We look forward to ongoing collaboration to ensure these supports reach businesses across all of Toronto’s main streets.”
– John Kiru, Executive Director of TABIA
“We commend Toronto City Council for increasing property tax savings for small businesses, especially during these challenging and uncertain economic times. We look forward to working with the city on refining the eligibility criteria so more small businesses can benefit, including adding properties in office buildings and shopping centres.”
– Angela Drennan, Vice-President, Legislative Affairs (Ontario) at the Canadian Federation of Independent Business (CFIB)
Toronto is home to more than three million people whose diversity and experiences make this great city Canada’s leading economic engine and one of the world’s most diverse and livable cities. As an Official Host City for the FIFA World Cup 2026™ and the fourth largest city in North America, Toronto is a global leader in technology, finance, film, music, culture and innovation and climate action, and consistently places at the top of international rankings due to investments championed by its government, residents and businesses. For more information visit the City's website or follow us on X, Instagram or Facebook.