Nah nah nahnah nah nah.
On Tuesday, the Toronto Board of Trade made a deputation to the Budget Advisory Committee of the city of Toronto. Among the business group’s recommendations was a call for the imposition of a 3 per cent surcharge on property taxes for the next five years. The Board felt that this is necessary in order to repair crumbling infrastructure, especially the city’s pothole laden roads.
The Board of Trade’s proposal for a tax increase stunned the city, especially the councillors on the committee whose careers consist primarily of raising taxes and user fees. “So you’re actually recommending a larger tax increase than we’re recommending?” asked budget committee member Councillor Gord Perks, not quite believing what he was hearing.
Homeowners in the city have recently taken two hits. The city’s land transfer tax that was imposed thanks to Ontario premier Dalton McGuinty’s gift of the City of Toronto Act just recently took effect. Although it is too early to tell, there are indications that this tax will have an adverse psychological effect on housing sales in the Big Smoke that goes beyond the actual increase in housing prices. As well, council has announced that next year property taxes will increase by 3.75 per cent. Mayor David Miller had promised to hold tax increases to the rate of inflation. When told that inflation was a lot lower than 3.75 per cent, the mayor responded that the increase was “in line with” the inflation rate. Presumably “in line with” really means going up, damn the actual amout. Now the Toronto Board of Trade, an alleged business group, wants the hapless homeowners to pay a 6.75 per cent increase next year and more taxes in the subsequent four years.
It is difficult to know what possessed a business group to suggest a significant tax increase that made even the diehard socialists on Toronto City Council blush. Perhaps there is something in the air that is drifting northward across the border from the U.S. where those evil rightwing Republicans are about to make John McCain their presidential nominee. But more likely, the Board of Trade is attempting to take the heat off of the city businesses by overtaxing the city’s property owners. If this is indeed the case, it is extremely shortsighted. Businesses don’t exist in a vacuum and it is likely that the newly imposed municipal land transfer tax, coupled with ever increasing property taxes will see more city residents opt for the burbs.
What is amusing about the Toronto Board of Trade’s proposal is that they use the same excuses for the necessity of raising taxes that tax and spend governments do. Much like the income tax that was imposed to fund World War I, it is only a temporary tax that is needed to fund a dire necessity. Crumbling infrastructure is an emergency to them. But everything is an emergency to someone; where will it all end? Experience teaches us that temporary taxes and surcharges have a way of becoming permanent. The reality is that if imposed, there is no guarantee that the revenues from this additional tax would be used for the purpose that it was intended for.
Another argument that the current lover of higher taxes brought forward was that the average cost to the taxpayer is only $70. Sure it is; $70 for this and $55 for that, etc and it all adds up. The Board of Trade’s comments are reminiscent of the immortal words of the late U.S. Senator Everett Dirksen who once said, “A billion here, a billion there, and pretty soon you’re talking about real money”. And of course the Board of Trade does not think of their suggestion as at tax grab; rather it is an “investment” in the city. This is not quite as colourful as when David Miller referred to taxes as “revenue tools” but hey, he’s the pro.
The goal of the Board of Trade is to make Toronto “a truly livable and competitive global city”. Does this group not see that they sound exactly like the socialist city mothers who have gotten Toronto into the deep doo-doo that it is now in and whose solution for everything is to increase taxes and user fees or impose new ones? A simple solution to solving problems is always to increase taxes. We expect that from left leaning politicians but deserve more from purported business groups.
As for Mayor David Miller, he can be reassured that there is in fact life after politics. He can have a great future heading the Toronto Board of Trade.
