Municipal Land Transfer Tax

What is the fundamental issue?
REALTORS^® are concerned that the new revenue generating powers granted to the City of Toronto could result in the spread of municipal land transfer taxes (MLTT) to other regions of Ontario.

I’m a REALTOR^®. What does this mean to me?
Extending the power to levy a MLTT to all of Ontario’s municipalities would devastate the real estate industry in Ontario by adding thousands of dollars to the costs of real estate transactions.

In addition, a MLTT would price many low and middle income Ontarians out of the real estate market entirely

Legislative/Regulatory Outlook/Status
On January 1, 2007, the City of Toronto Act became law. The Act provides Toronto with broad powers to pass by-laws regarding matters that range from public safety to the city’s economic, social and environmental well being. The Act also gave the City of Toronto new taxation powers, including the ability to charge MLTTs.

A December 2008 C.D. Howe study on the impact of a MLTT in Toronto showed that it has reduced home sales by 16 per cent since its implementation, costing the local economy $160 million in ancillary economic spending.

In January 2009, the Ministry of Municipal Affairs and Housing launched a ‘technical review’ of the City of Toronto Act. OREA and the Toronto Real Estate Board made a submission to the review calling on the government to roll back the MLTT in Toronto and refrain from giving the powers to other municipalities.

While the Minister would not commit to rolling back the MLTT back he did indicate that, “the Province is not proposing to introduce legislation to extend [the MLTT] authority at this time.”

OREA Position
OREA believes the Toronto MLTT is unfair, unprecedented, and unjustified. It forces a small segment of taxpayers, home buyers, to fund municipal services designed to benefit all citizens.

OREA is asking the provincial government to amend the City of Toronto Act to rescind the MLTT.

OREA also believes that no changes should be made to the Municipal Act that will permit the unfair and unjustified, double taxation of real estate in other jurisdictions across the province.

Last updated: May 19, 2009