According to an article published by Toronto Star, Brampton is officially paying more in property taxes than Toronto.
According to the Star, a $500,000 home in Toronto costs about $3,495 in property taxes. After Brampton’s 2017 property tax increase, a house of the same price will cost $5,278 in taxes.
In just a few decades, Brampton has grown from a small town of 100,000 people to well over 600,000. With that comes the need to grow service levels and infrastructure to match population growth.
Brampton’s need to keep up with rapid growth and infrastructure requirements is one of the main reasons for the 2017 property tax hike.
One thing that Brampton lacks that Toronto has is a diverse range of taxation tools. Toronto not only benefits from property taxes, but also collects revenue through land transfer taxes.
Toronto can also collect a personal vehicle tax, alcohol and tobacco taxes, parking taxes and others, but chooses not to.
The city is currently looking into tolling the Gardiner Expressway and Don Valley Parkway, highways built by the province but then unceremoniously dumped onto Toronto’s budget over a decade ago.
Currently Toronto is the only city in Ontario granted the option to collect taxes from means other than property taxes.
Not only does Toronto have more revenue models in order to keep property taxes low, they also have a more dynamic property tax base.
Brampton’s sprawl is one of the issues that has property taxes on the rise. In order to offer more services like transit, roads, and recreation centres to the outer edges of the rapidly growing city, property taxes have to increase.
Condos and high-density development brings in significantly more property tax revenue than single family dwellings and low density development. But the trend of building subdivisions continues in Brampton, and with it, more infrastructure without a substantial influx of tax money to keep up.
One option the city has been toying with is charging higher property taxes to homes with rental units.
Two years ago the city legalized basement apartments, but only a small percentage of Brampton’s 30,000 secondary units are currently registered. Those not registered are considered illegal.
Taxation of secondary units could provide tax dollars to help fulfill the city’s growing needs, but the city has yet to develop a model to ensure all second units are legal and therefore paying their fair share of property taxes.
