Toronto City Council Approves Threefold Increase in Vacant Home Tax to Tackle Housing Crisis
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The Toronto City Council has approved a significant increase in the vacant home tax to address the city's growing housing crisis. The tax, initially introduced in December 2021, previously imposed a 1% annual fee on homes and condos left unoccupied for more than six months. The new increase will raise the tax to 3% of the property's assessed value, starting in the 2024 tax year. Mayor Olivia Chow supported this move to combat speculators who withhold much-needed housing, driving up rental prices and worsening affordability issues.
The tax, which brought in $54 million during its first year, aims to encourage owners to sell vacant properties or make them available for rent. A portion of the additional revenue generated by the tax hike, at least $10 million, will be directed towards a city housing program that provides grants to non-profit housing operators to acquire private market rental housing. The increased tax is estimated to generate approximately $105 million in 2025, nearly double the expected revenue at the 1% rate for 2024. While the majority of the council welcomed the tax hike as a measure to address the housing crisis, some expressed concerns that it was motivated by revenue generation rather than housing supply expansion.
This tax increase is part of a broader effort to address a housing crisis in Toronto and trim the city's budget deficit. The tax has been seen as a means to encourage more properties to enter the housing market, potentially making housing more accessible and affordable for residents.
Read the full article on: CBC
