November 4, 2021 – In their Fall 2021 economic update, the Province announced that “the priority is maintaining stability for taxpayers and municipalities at this time”, and therefore, the reassessments that were scheduled to be conducted for the 2021 and 2022 tax years were postponed. As such, property assessments for the 2022 and 2023 tax years will continue to be based on the same valuation date that was used for 2021. For more, visit MPAC’s (Municipal Property Assessment Corporation) webpages:
You asked, FOCA answers – Property Re-assessment
A member recently enquired:
We recently did some renovations to the cottage which triggered a reassessment notice from MPAC. I know retail sales prices have gone crazy in this area over the past 18 months. My question: is the new assessed value I received from MPAC based on current (2021) comparables, or 2016 values?
Since mid-2021, FOCA has been expressing concerns about the new Underused Housing Tax (UHT) which is being implemented January 1, 2022 by the federal Finance department. Our worry is that American and other foreign owners of rural waterfront property in Canada (“cottagers”) will be unfortunately and mistakenly penalized by a federal policy that is really designed to free up rental and other accommodations in population centres (mostly urban) that are facing housing shortages.
As of November 2021 we are still awaiting word of the promised consultations to consider special rules or exceptions, e.g. for residential properties located in smaller, resort and tourism communities, and if so, what those exceptions should be.
Ontario residential property tax system: FOCA’s position
FOCA advocates for fair property taxation on behalf of waterfront residential property taxpayers in Ontario.
“Downloading” by the Province onto municipalities, and hence property owners in Ontario, is higher than all the rest of Canada. This inordinate local funding burden amplifies the unfairness inherent when property value is the sole determinant of how much an individual who pays for a lengthy list of municipal obligations. FOCA believes the provincial government must hasten and broaden the provincial role in financially supporting social services through provincial income taxes, which has only partially been addressed in the recommendations of the 2008 Provincial Municipal Fiscal and Service Delivery Review.
The use of current value assessments (CVA), as a means to calculate property owners’ payments for municipal services received, continues to unfairly distribute social costs. There are precedents in other North American jurisdictions for a fairer process, acknowledging that there are municipal services that should not be paid for solely on the basis of the value of one’s property. To use pure CVA to calculate tax obligations amounts to a tax on unrealized capital gains.
Failing to address the shortcomings within the current process will contribute to instability in many Ontario communities, forcing the untimely disposition of family assets. This is only one unfortunate if unintended consequence from the current instable and unpredictable property tax system. It is FOCA’s contention that the Province must forthwith take concrete steps to address the instability and unpredictability of property taxation in Ontario.
Your property taxes are affected by:
- the education tax rate (set by the Province)
- the municipal budget (established by your Municipality)
- the municipal tax rate (set by your City/Municipality)
- your property’s assessed value (determined by MPAC)
What can you do about your property taxes?
1) Prevent an increase in your municipal tax rate.
Municipal governments across Ontario are currently formulating and approving their annual budgets. Local spending decisions being made NOW will directly affect your property tax bill. Every property owner and resident should be paying attention.
NOTE: the tax bill you receive early in the calendar year is based on an INTERIM rate, but this will change, pending municipal budget decisions. Read more about MUNICIPAL BUDGETS and how to get involved in your local budget-setting process by following the link at the end of this page.
2) Challenge your MPAC assessed value.
The most recent MPAC notices showing your property’s assessed value at January 1, 2016 will be issued to property owners beginning in April 2016, and will be used to determine the 4-year phased-in assessment values – starting with the 2017 taxation year.
The value to be used in 2017 can be challenged, if you commence that challenge before the RfR deadline date. To do so, you must develop a rationale as to why you believe your property has been overvalued as at January 1, 2016 – NOT what may have transpired since. Read more about submitting a “Request for Reconsideration”.
November 20, 2019 – Value of more than 800,000 Ontario properties to be reassessed this year (Durham Radio News)
August 19, 2020 – Top Aggregate Producing Municipalities of Ontario (TAPMO) asks Ontario government to increase property taxes on quarries (Equipment Journal)
July 29, 2020 – Ontario government not considering expanded taxation powers for cities (Ottawa Citizen)
May 20, 2020 –AMO calls on Canada, Ontario for support for COVID-19 emergency expenses (AMO)
August 19, 2019 – Why municipalities are worried about the return of “the D word”: Downloading (TVO)
August 1, 2019 – Ontario Cities with the Highest and Lowest Property Tax Rates (and why do they vary from city to city?) (Zoocasa)
April 26, 2019 – Provincial government moving ahead to reduce the amount of money families pay in estate taxes after the death of a loved one (London Free Press)
April 24, 2019 – A taxing problem: Why cities desperately need new sources of revenue. In Ontario, municipalities collect only nine cents from every household tax dollar — not nearly enough to cover their ever-increasing list of responsibilities (TVO)
June 2, 2018 – NDP propose whopping new housing speculation tax (Toronto Sun): “Ontario NDPers say they would work to ensure their version of the tax does not apply to family cottages”
May 19, 2018 – Property tax was never designed to fund provincial programs
BC Vacation Homes / out of Province owners facing punitive taxation
In the February 20, 2018 Provincial budget, B.C. included what the government is calling a speculation tax. It would apply to owners who do not pay income tax in British Columbia. Principal residences are exempt, as are properties with long-term renters. The tax in 2018 will be 0.5 per cent of a property’s assessed value, a rate that rises to 2 per cent for 2019 and thereafter. (Globe and Mail)
August 28, 2017 – Bracebridge mayor explains benefits of proposed HST hike on property taxes; HST increase proposed to help municipal infrastructure costs (Muskokaregion.com)
August 24, 2017 – Provincial leaders reject HST infrastructure solution (Minden Times)
August 2017 – Municipal governments collect only 9% of all taxes. Property taxes can’t keep up with growing local needs, and the Association of Municipalities Ontario (AMO) have identified an almost $5 billion funding gap for the next 10 years to maintain current services and address the infrastructure gap. See the full perspective from AMO http://thelocalshare.ca/
July 5, 2017 – Lower property tax rate based on services received? According to this former appraiser, “Property tax, assessment not easy, but fair: Gravenhurst resident”
(Letter to the Editor, Gravenhurst Banner)
June 2, 2017 – HST hike suggested by AMO as a way to close the $4.9 billion infrastructure gap for municipalities (Postmedia)
April 20, 2017 –Wynne to slap 15 per cent tax on foreign real estate speculators; will roll out a 15 per cent “non-resident speculation” tax to help cool down southern Ontario’s real estate market. (Toronto Star)
April 18, 2017 – Ontario promises curbs on hot housing market within a week (CBC News)
Sousa had asked Morneau last month to boost the capital gains tax rate, but the federal minister made no change in the 2017 Federal budget. On Tuesday (April 18), Morneau shot it down definitively. “Everything we wanted to say about capital gains taxes was in our last budget,” he said.
April 12, 2017 – Real estate speculators driving up prices to be target of reforms, Sousa says
April 12, 2017 – Liberals try to fix Toronto’s housing market without sinking it (Ottawa Citizen)
“Engineering a result so precise with something as big and plainly irrational as the housing market is not easy. All the worse if the things you do affect millions of other Ontarians who haven’t lost their minds.”
April 6, 2017 – Ontario Finance Minister wants meeting on house prices with federal counterpart soon (Toronto Star)
March 31, 2017 – In light of the troubling proposals by Ontario’s Finance Minister, FOCA issued this letter to the Provincial and Federal Ministers of Finance, and a media release in early April. With over $750 billion (CIBC, 2016) in inter-generational asset transfer set to occur over the next 10 years (including a significant amount of waterfront property staying within the family), FOCA will strongly oppose any further capital tax burden.
March 20, 2017 – Ontario wants Ottawa to boost tax on real estate speculators
Federal Finance Minister Bill Morneau urged to cool housing market by increasing capital gains tax (CBC News)
March 8, 2017 – Municipalities are responsible to set property tax policy (Elliot Lake Standard)
February 17, 2017 – Expect to pay more tolls, higher property taxes to fund infrastructure (CBC News)
* Note: starting with the 2016 tax year, your deadline to file a RfR will depend on the date you receive your property assessment notice. The previous deadline (March 31 of each year) NO LONGER APPLIES.
MPAC presented a 2016 Property Tax update to the FOCA Spring Seminar on March 5, 2016. A copy of this presentation can be made available to FOCA Members.
December 1, 2015 – Cities outside Toronto cannot charge land-transfer tax, Ted McMeekin says (Toronto Star)
July 24, 2015 – Municipal officials in Fort Frances, Dryden, Espanola and other small rural Ontario towns have dealt with decreased industrial assessments by raising residential taxes, cutting jobs and slashing infrastructure spending. Tax shift: Companies dump burden of taxes on squeezed municipalities (Globe and Mail)