Councillor queries city's land transfer tax 'math'
October 22, 2008
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Paul Moloney
CITY HALL BUREAU
The City of Toronto now says it has collected $130 million from its new land transfer tax since the levy on real estate sales came into effect Feb. 1.
The updated figure was provided in a news release yesterday after the Star reported that the take for the first five months (February through June) was $54.8 million.
City finance officials did not respond to repeated requests for further details yesterday or Monday.
The city has insisted it is on target to collect a projected $155 million this year.
Originally, the land transfer tax was supposed to generate $300 million a year, but after a long, bitter battle last year to get the hike through city council, many revisions were made, resulting in a lower tax rate and more exemptions.
Councillor Michael Thompson, who has formally requested that the mayor answer a series of questions about the tax, said the new figure implies the tax generated $76 million over the past three months (July through September). He noted, however, the summer months are traditionally slower for real estate sales, and the Toronto Real Estate Board has been reporting a sales drop amid a slowing economy.
"I don't understand the math," he said. "I'm really shocked if that's in fact the case, because it's contrary to everything we know, it's contrary to all the economic indicators that we've been seeing."
Thompson noted the city has not produced a report updating the tax, which was passed last year over the vehement objections of real estate agents.
"It leaves me with huge questions. I want a full explanation, a full accounting at how they arrived at all these numbers."
Toronto Star