Are your Property Taxes Fair?
Almost every Canadian feels like they are taxed to death. Every time they turn around they are being taxed on something. One of the big complaints that Toronto property owners have is their property taxes. Every level of government has some form of taxes that they level against the public. It is this tax money that they partially rely on to provide the services that the public demands. Property tax is the mainstay for the municipal government level. In fact, about 40% of this level of governments operating budget comes from the property tax.
While the federal and provincial governments can have deficits the municipal level of government cannot. So what they have to do is first determine how much money they are going to need to do their jobs each year, and then based on this they set the tax rates.
Now when it comes to exactly how much you have to pay that is determined by the value of your property based on the municipal average. Some think that if the value of their property really increases and doubles for example then their taxes are going to double as well. This is not the case. What is important is how the values of property change in the city on the whole. If your property were to increase in value at a rate that that is more than the average, then your taxes will increase.
Municipal property assessments are conducted every four years. This way the municipal government can stay on par with the property value changes that have taken place during that time. The assessment doesn’t automatically change everyone’s tax bill. What it does is redistributes who pays what in the city based on the change in the property value as it relates to the average.
Property taxes are different from most other taxes. They don’t go up based on the economy. It only goes up on the whole if the city counsel goes for an increase in the tax rate. At times there is no choice but to this because the overall expenses that the property tax has to pay for is continuously on the rise.
Something that is often forgotten also is that there are different types of property tax, which makes sense because there are different types of property. These include residential, and non residential which are the multi-residential, industrial and commercial. Each of these are assigned different tax rates.
Many businesses feel that the property tax for businesses was way too high. In 2005 the municipal government took steps to close the gap somewhat between the different levels of taxes. In the end it turned out that residences ended up paying more until they become more on par with the businesses.