Fri. Aug 19th, 2022

Toronto City Council has approved a plan to implement a vacant housing tax starting next year.

In a press release issued Thursday, city officials said the goal of the tax is not to levy revenue, but to create a barrier for homeowners to keep their homes vacant and again increase the housing supply.

“A statute supporting this tax will enter into force on Saturday, January 1, 2022 and will be the start of the first tax reference year – a period in which job status will be used to determine whether the tax is payable,” the press release said.

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“The tax on vacant housing will be paid for the first time in early 2023, based on occupancy status in the previous year.”

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Officials said a home would be considered vacant if it was vacant for more than six months in the previous calendar year “or it is considered vacant under the bylaws.”

Exceptions include homes under renovation, snowbirds if the homeowner is in medical care or passing away.

“I am pleased to see the council approve a vacant housing tax today. Although a majority of property owners in Toronto will not pay this tax, the benefits will be felt throughout the city by increasing the availability and affordability of housing supply, ”said Mayor John Tory in the announcement.

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City recommends tax on vacant homes in Toronto

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The tax rate will be one percent of the home’s current valuation.

Officials said it is not clear how many homes in the city are vacant, but if one percent is vacant, the city could generate $ 55 to $ 66 million a year.

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Tory said the tax will also help build more affordable housing.

Homeowners must declare the status of their home each year, and certain properties may be selected for review.

The will of the Council is ready to review a final report and tax statute before the end of the year. The articles of association must be adopted for the tax to enter into force.

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