Category Archives: Land Transfer Tax

BREAKING NEWS: Ontario helping first-time homebuyers

Ontario is doubling the rebate on the land-transfer tax for first-time homebuyers to $4,000, but is increasing the same tax on homes that sell for over $2 million.

The government says half of first-time buyers won’t pay any land-transfer tax to the province, while the half-percentage point increase on homes over $2 million will affect less than one per cent of the population.

The province takes in over $2.1 billion a year in the land-transfer tax, and the government says any increase in revenues from the increase on luxury homes will help pay for the doubled rebates for first-time buyers.

Premier Kathleen Wynne had said the government was worried about the difficulty faced by first-time buyers trying to get into the housing market, especially in the Greater Toronto Area where the average price is $762,975.

The government also announced it is freezing the property tax on apartment buildings while it reviews how it affects rental market affordability.

The changes to the land-transfer tax are outlined in the Ontario government’s fall economic statement, which says that home ownership has become a key factor in many people’s long term financial security.

The Ontario Real Estate Association had asked the government to expand the land-transfer tax rebate program for first-time buyers as one way to help more of them get into the housing market.

The city of Toronto has its own land transfer tax, which offers rebates of up to $3,725 for first time buyers.

Ontario’s land-transfer tax rises from half-a-per cent on the first $55,000 of a purchase price to two per cent for everything above $400,000. Toronto’s land-transfer tax is one per cent on the first $55,000 and two per cent on the rest.

Source: The Canadian Press | 14 Nov 2016
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Cities outside Toronto cannot charge land-transfer tax, Ted McMeekin says

Ontario Municipal Affairs Minister Ted McMeekin: "It is clear that there has been no call for a municipal land transfer tax."

Homebuyers outside Toronto no longer have to worry about paying thousands of dollars in local land transfer taxes.

Municipal Affairs Minister Ted McMeekin shut down speculation Tuesday that cities and towns would be given permission to bring in their own such levy in addition to the provincial land transfer tax.

“There has been no call, at all, for a municipal land transfer tax, nor is there any legislation before the House that would allow this,” McMeekin said in the legislature’s daily question period.

Toronto will remain the only Ontario city allowed to charge a land transfer tax, he added, but offered to look at “what possibilities exist” for other new sources of revenue to help strained municipal budgets.

 

McMeekin’s surprise announcement followed a push against a local land transfer tax by the Progressive Conservatives and the Ontario Real Estate Association’s “don’t tax my dream” campaign, arguing it could push house prices further out of reach for many families.

“I’m glad the minister made the right decision,” said Conservative MPP Steve Clark (Leeds-Grenville), blaming the government for floating the idea earlier this fall and crediting a “grassroots” efforts with stirring up opposition.

 

McMeekin had said earlier this fall during consultations with local governments that any new revenue powers for them would be optional and did not rule out a land transfer tax.

The Association of Municipalities of Ontario said it wants local councils to have “discretionary authority” just like what Toronto enjoyed in levying its own land transfer tax to raise revenues for services, transit and other infrastructure.

“Ontario municipalities face significant fiscal challenges, just like Toronto,” AMO president Gary McNamara said in a statement after McMeekin’s announcement.

“In many communities, property taxes are poorly suited to the burdens that communities face. We all need to look at new solutions that will work.”

McMeekin suggested local governments could do more in the way of development charges as “a potential significant source of revenue.”

Clark and the Ontario Real Estate Association had warned home buyers would have to dig much deeper into their pockets if local land transfer taxes were authorized.

“This is a huge win for Ontario’s home owners and those who dream of one day owning a home,” said Patricia Verge, president of the real estate group.

In Toronto, the buyer of a $450,000 home pays a total of $10,200 in land transfer taxes: $5,475 for the provincial levy and $4,725 to the city. The city tax was added in 2006.

Source: Toronto Star  Queen’s Park Bureau, Published on Tue Dec 01 2015

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Land transfer tax poised to go province-wide, real estate association warns

Toronto’s dreaded Municipal Land Transfer Tax could soon be a province-wide reality.

In a release posted on its website, the Ontario Real Estate Association (OREA) says the government is poised to allow municipalities across Ontario to implement their own respective versions of the tax.

“The Ontario Ministry of Municipal Affairs and Housing has indicated that they are going to make buying a home even harder by giving every municipality province-wide the power to charge a Municipal Land Transfer Tax, a change that will double the land transfer taxes consumers have to pay on their next home,” OREA stated.

The city of Toronto implemented the tax in 2008. It works out to an extra $10,000 to $15,000 on a home priced at about $450,000, with half of the revenue going to the province and the other half going to the city. The city pulls in about $300 million annually from the tax.

OREA urges Ontario residents to visit www.donttaxmydream.ca to learn more about the perils of the tax spreading province-wide.

The group’s president, Patricia Verge, said the move would break an election promise and place an unbearable financial strain on families.

“The Ontario Liberals wrote to us in May 2014, during the election, stating that ‘they had no plans to extend these powers to municipalities.’ ”

“Ontario home buyers are already charged a provincial land transfer tax, so by adding a municipal tax, they’re essentially doubling the tax burden on Ontario families,” Verge said in the release.

“If the Ontario Liberals follow through with this plan, home buyers will be forced to pay $10,000 in total land transfer taxes on the average priced home in Ontario, starting as early as next year.”

The province’s minister of municipal affairs and housing told the Financial Post a final decision hasn’t been made, despite OREA’s insistence.

“We are currently reviewing the Municipal Act. No decisions have been made,” said Ted McMeekin, who added that public consultations on the matter are still ongoing until Oct. 31.

Source: 680 News Posted Oct 27, 2015 4:12 pm EDT

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