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EDITORIAL: The Vacant Home Tax: A multi-mayor failure (Apr. 2024)

May 7th, 2024 · No Comments

The Vacant Home Tax (VHT) is an unabashed debacle. The City of Toronto just sent 167,000 homeowners tax bills that include a one per cent VHT levy based on the values of their properties. If, for example, their Municipal Property Assessment Corporation valuation is $800,000, then the city just added a surcharge to their tax bill of $8000. Payable when? Now.

The VHT applies to individual homeowners, including condo owners, who failed to declare their residences occupied. The assumption is that if homeowners did not make this declaration, then the premises are vacant. The onus is on the taxpayer. 

Imagine seniors with language barriers or people who were in Florida for the winter and missed the deadline or did not even understand it. And how about that increasing cohort of people who don’t open their mail as everything is done automatically through their banks. All these people are upset, and rightfully so. How many still don’t know that the city is just docking their bank accounts and enriching city coffers?

At the heart of the failings of the VHT is negative option billing which is deeply unethical. Using this approach, a company (or in this case the government ostensibly working for you) adds new charges without your consent and assumes you accept them unless you decline. 

Rogers Communications started charging for a new cable TV package in the late 1990s when customers failed to “declare” they did not want an expanded package of channels. Customers were so incensed that the federal government enacted legislation in 1999 to stop the practice. Who was in charge at Rogers at the time? You guessed it, the now former, City of Toronto Mayor, John Tory. It was on his watch that Rogers pursued negative option billing and on his watch that Toronto enacted its “opt out or pay plan” with the VHT. It was wrong then, and remains so, and we have Tory to thank for that. That is Mayor Number One to blame. Tory is back on the Rogers board of directors, by the way, hmmm….

At the root of the VHT policy is the housing crisis that in theory could be partly solved by encouraging property owners to rent their premises, resulting in people occupying now vacant spaces. The goal is laudable; it’s the execution that sucks. The VHT has been around since 2022 but the city has not supplied any evidence that it has actually changed things in the vacancy ledger. It seems they don’t really care as they are salivating at the dividends that accrue to the city when the policy fails: Oops, you failed to declare occupancy; please pay the city; do not pass GO.

Chow likes to evade responsibility for the program’s failures: “The person who designed the program is no longer with the city.” She’s intimating that she found the will to take charge and fire someone? The city manager says no one lost their job; that myth busted. So, we are left to infer that the person is John Tory, who resigned for other reasons. This vague suggestion that someone was actually reprimanded for poor performance is not convincing. The mayor has stated, “How could anyone justify the send button on 165,000 bills?” It’s your staff Mayor Chow. It’s your organization, and the mayor is the lead; this is not church and state. The first rule of leadership is “everything is your fault.” This is the first leadership role for Chow, having spent a lifetime on political backbenches throwing snowballs at the government bus. Now, you are in charge, act like it.

Councillor Brad Bradford stated in a recent column in the Toronto Sun that Chow herself had fallen victim to the VHT tax for her own home. In the eight months that have since elapsed she has failed to have a single meeting with city staff about the program failures. Mayor Olivia Chow has projected in her city budget that $200 million will come from this program in 2025 and 2026, and she has already earmarked the money. She is counting on the program to have victims. The sham is the plan thanks to Tory and Chow.

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Tags: Annex · Opinion