Item - 2021.EX25.26

The Executive Committee referred Item EX25.26 back to the Chief Financial Officer and Treasurer and requested the Chief Financial Officer and Treasurer to:

a.  conduct further analysis regarding:

i.  the estimated economic impacts, including job creation and gross domestic product, created as a result of the investments in the City's Capital Budget due to the City Building Levy;

ii.  whether any of the listed revenue tools would have adverse impacts on the City's post-pandemic economic recovery, and in particular, on hard hit sectors of the City's economy, including the hospitality industry; and

iii. the estimated impact on sales volume of homes in the City of Toronto if the Municipal Land Transfer Tax were increased on all homes worth over $2 million, $3 million, and $4 million, respectively; and

b.  report back to City Council, through the Budget Committee, as part of or before the City's 2022 budget process.

Toronto City Council has, over the last four terms of Council since 2006, identified and implemented a number of new revenue tools and measures, in efforts to diversify the City's revenue base, consistent with a fiscally prudent long term financial strategy.  These efforts to augment the City's revenue base and to tap new revenue sources included the Municipal Land Transfer Tax and Personal Vehicle Tax implemented in 2008, a dedicated Transit/City Building Levy in 2014 which has been increased annually since 2017, road tolls, a municipal accommodation tax for hotel and short term rental stays in 2018 and 2021 respectively, and most recently, a proposed tax on vacant residential units.

During 2021 Budget deliberations, and through its adoption of Item EX21.1: 2021 Property Tax Rates and Related Matters, City Council directed staff to perform an updated assessment of the revenue potential of certain new taxes permitted under the City of Toronto Act, 2006 (COTA), other new taxes not currently permitted under COTA and potential adjustments and revenue impacts related to the Municipal Land Transfer Tax.

This report provides an update on potential revenue options for Council's consideration, and responds to the information requests identified in EX21.1.