Executive committee asks for report on ways to reduce land transfer tax

The executive council voted on Wednesday in favour of having city staff explore ways to reduce the controversial land transfer tax, including a request by the mayor to reduce it by 10 per cent, and report back with options in July.

“I think 10 per cent is realistic and I think we can have a report by July,” Rob Ford said, during the committee’s monthly meeting.

The municipal land transfer tax (MLTT) brings in $340 million a year, which under the mayor’s scenario would mean staff will need to find ways to offset $34 million in general revenues.

“We’re going to have to find the efficiencies,” Ford said. “People are sick of it.”

Coun. Denzil Minnan-Wong said he could not support that 10-per-cent reduction unless the city could find ways to offset it.

City staff will also report back in July on ways to end the MLTT by reducing it by 24 per cent over four years. That request was made by Coun. David Shiner.

Shiner, who didn’t support the tax when it was introduced in 2006, said the MLTT is unfair and gets complaints about it from his constituents all the time.

“I think it’s a huge hardship especially for young families and seniors,” he said.

The average assessed house price in Toronto right now is $474,000, and a homebuyer pays $5,725 in municipal land transfer tax on a $500,000 home in the city, the city chief financial officer said. The province also charges a land transfer tax.

“The city has to come to the table now and find ways to get rid of it,” Shiner said.

The committee heard from staff that the argument against the MLTT comes from groups like the Toronto Real Estate Board which says the tax impacts a buyer’s decision to purchase a home. But city staff said the evidence hasn’t shown that since the city introduced the tax.

The main things that drive the purchase and sale of homes are interest rates and the economy, staff said.

In the same July report, staff will also study capping the MLTT for 2014 and beyond, a request made by Minnan-Wong, who says his goal is to reduce the MLTT but in a “reasonable fashion.”

In other committee matters, councillors considered a motion forwarded by Coun. Mary-Margaret McMahon about studying term limits for city councillors and the mayor.

She wanted the city to look at elected terms in other North American municipalities and to launch a public consultation process.

However, neither she nor Coun. Jaye Robinson, who supported her motion, was at the meeting and the committee voted to defer the matter indefinitely.

Amending rules regarding lobbying activity at city hall was also discussed. But the committee voted to defer the proposed changes indefinitely. In her report, the lobbyist registrar had recommended that the Lobbying Bylaw be amended to restrict the time and place lobbyists could meet with councillors and the mayor to 8 a.m. to 6 p.m. Monday to Friday.

City council meets for its regular monthly meeting on Thursday.

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