Bradford's Land Transfer Tax Cut Sparks Fiscal Concerns

Mayoral candidate Brad Bradford has proposed a plan to scrap the Municipal Land Transfer Tax (MLTT) on home sales valued up to $1.1 million. According to reporting from CBC Toronto, Bradford's team estimates this policy would cost the city $300 million.

Bradford argues that the tax, which doubles an existing provincial charge, deepens affordability issues and keeps potential buyers on the sidelines. Daniel Steinfeld, president of the Toronto Regional Real Estate Board, noted that the MLTT adds $36,000 in upfront fees to the average Toronto home purchase, which costs slightly over $1 million.

However, the proposal comes as Toronto grapples with funding gaps exceeding $1 billion at the start of recent annual budget deliberations. The MLTT is expected to generate $850 million in revenue next year, down from over $1 billion in 2021. While the tax has raised billions since its 2008 inception, those funds are increasingly used to pay for basic services in the city's operating budget.

To fund the tax cut, Bradford suggests creating a public water company to generate potential dividends and extending the timeline for paying off infrastructure projects.

Critics and experts cited by CBC Toronto warn of the city's precarious fiscal position. Zac Spicer, a public policy professor at York University, noted that the plan involves significant trade-offs. Additionally, former city manager Peter Wallace warned as early as 2015 that city hall was becoming overly reliant on the MLTT, describing it as a "volatile" revenue source.