TORONTO, March 20, 2013 -- In light of a suggestion to cap the Toronto Land Transfer Tax, being considered by the City of Toronto's Executive Committee today, the Toronto Real Estate Board is restating its powerful belief that this tax should be phased-out.
"The Toronto Land Transfer Tax should be dumped, not capped. We are inspired that the Executive Committee is considering action on the Land Transfer Tax, not only is capping not quite enough to correct the problems this tax is creating for our City, it could make this bad tax even worse," claimed Ann Hannah, President of the Toronto Real-estate Board.
In a letter to the Executive Committee, TREB has indicated that, based primarily on reported details, the suggested capping scheme could create substantial uncertainty for house buyers, if, as proposed, surpluses in Land Transfer Tax cash are devoted for reducing the tax in the subsequent year. Under this scenario, house buyers may be artificially inspired to obstruct home purchases, so interfering with the natural operation of the real estate market. The only possible way to really answer the problems this tax is creating for our Town is to get shot of it ; and with a predictable phase-out technique, home buyers could make intelligent choices and City Council could set a fair schedule, which would make market distortions unlikely," declared Von Palmer, TREB's Chief Government and Public Affairs Officer.
Research has proven that city land transfer taxes have a unwanted effect on home sales. Howe Institute lately released an evaluation of the Toronto Land Transfer Tax, which shows that this tax has hurt Toronto's economy by dampening home sales by 16 %. The C.D. This is supported by a recent poll conducted by Ipsos Reid, which discovered that 77 per cent of GTA residents planning to get a home in the subsequent two years are more likely to purchase outside Toronto specifically to get around paying the Toronto Land Transfer Tax. This poll also discovered that virtually 7 in ten Torontonians, 68 per cent, support plans to eliminate the Toronto Land Transfer Tax. The public has continually made it clear that they require the Land Transfer Tax scrapped," said Palmer.
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