Toronto’s property tax rates vs the GTA’s

People love to say that, since Toronto’s residential property tax rate is the lowest in the GTA, there’s a lot of room to increase it, even just to the average. (For reference: Toronto’s property tax rate is 0.7929218%; the average GTA tax rate is 1.13843887391304%.)

2011 GTA residential property tax rates

What these people are ignoring is that property tax rates are only half of the equation. In order to find out how much it actually costs individual taxpayers, you have to multiply the tax rate by the property value. And, as it turns out, average property value in the GTA isn’t the same in different cities.

GTA residential property tax burden

When you look at what the average property owner actually pays, you find that Toronto’s tax burden is not the lowest in the GTA. By my calculations, the average annual property tax in the GTA is $5,139; those same calculations show Toronto’s average annual property tax as $4,392. (I believe all these values include the education amount.)

I’d say that Toronto’s tax burden is fairly middle-of-the-road; it’s within 1 standard deviation of the average.

Were we to increase Toronto’s property tax rate to the GTA’s average, Toronto’s average tax burden would increase to $6,306, an increase of $1,913&emdash;43%.

Increasing Toronto’s property tax burden to the GTA’s average would be an increase of $747, or 17%.

I don’t believe that Toronto’s tax rates need to increase significantly over inflation. Doing so would penalize Toronto’s property owners instead of raising money from everyone who lives in and visits Toronto.


Sources: For property values, frequently realtors publish recent sales prices. It is very difficult to find average property values, unfortunately, so I used sales prices as a proxy for property values.

2011 tax rates are on PropertyToronto.com.

Finally, here is my working spreadsheet, including all souce data I used and the charts.

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7 responses to this post.

  1. Posted by Scott on December 12, 2012 at 3:25 pm

    The debate about the city paying for access roads so visitors can come in from out of town to work is a bit of a non-starter. City businesses pay a lot of property tax, which in part should be seen as covering the costs the city incurs to deal with the influx of employees – plus on any given day there seem to be just as many people heading west and north out of the city to go to work.

    Reply

  2. […] in property values, the city winds up right in the middle of the pack. (Check out Joe Drew’s excellent analysis.) So when someone claims that we are very, very over-taxed, I have to ask: Compared to… ? Not our […]

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  3. […] the assessment value of particular properties. At 0.79 per cent, the mill rate for Toronto is the lowest in the region by far; Hamilton and Oshawa charge almost twice that. However, Toronto’s property values are […]

    Reply

  4. Posted by Andy Clark on January 29, 2014 at 6:16 pm

    Why do people who live in Toronto think that everyone who visits should pay the same amount to support their transit, parks, etc that visitors only get to use occasionally. Listening to this debate from somewhere that has no public transit at all, not even out of town bus service on the weekend, get real Toronto. Grow up and start paying for what you get, never mind what you want. You should look at the services available to residents and add up the cost – why should the rest of the province pay for benefits that only the residents of Toronto get? Like the ice storm only happened to Toronto? Wake up. Any provincial politician from out of Toronto that supports more funding transfers to Toronto will be looking for a job after the next election.

    Reply

  5. property tax are very high in Brampton. Just this year I had a $1200 increase… Unbelievable.

    Reply

  6. Your last sentence: “[Increasing property tax above inflation] would penalize Toronto’s property owners instead of raising money from everyone who lives in and visits Toronto.”

    You seem to be suggesting an alternative, more fair way of getting the revenue Toronto needs (given that it must get more revenue somehow). What is this other way? One of the untapped taxes from the City of Toronto Act (gas tax, congestion tax, entertainment tax, etc.)?

    Reply

    • There are lots of options, but some of the most fair would be a sales or income tax levied in Toronto (or the greater GTHA); sadly both of those aren’t possible in the existing City of Toronto Act.

      In general, adding just about anything to the current state of relying solely on property and land transfer taxes would be a good change.

      Reply

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