Life in Toronto is becoming so intolerable, Kevin Gaudet of the Canadian Taxpayers Federation declared on Monday night, that he can't even "get lucky" with his wife without attracting attention from the ever-grasping tax man.
Visions leap to mind, questions abound. But let's set them aside. The point here is to show just how tough it is for a regular guy to enjoy a little harmless fun in this sorry day and age, even if he is married.
If you don't buy that, then it shows just how nutty things can get when governments go out of their way to solicit public opinion on upcoming tax hikes. The concerned citizens (and lobbyists) who showed up to the first public consultation on the Miller regime's proposed "new revenue tools" didn't sit quietly while unexcitable city treasurer Joe Pennachetti droned through the soporific "fiscal context." They quickly reduced the meeting to a shambles.
"Facilitators" threw up their hands as failed politicians, anti-tax activists and small-business owners took turns denouncing the perfidy of new city taxes on booze, smokes and cars. It was a revealingly thuggish performance that will no doubt be repeated at upcoming consultations. What it will never do, however, is prevent the progress of the civic taxman. Leaving aside the abiding mysteries of Mr. Gaudet's domestic life, the only real question remaining in this fix is how much the man, that being Mayor David Miller, will dare to grab.
The booze tax is a no-brainer that few will notice. Because it isn't sold at government outlets, tobacco will likely escape. But a $40 (or more) city vehicle tax is just paperwork, and therefore certain. The big unknown is how much Mr. Miller will dare to suck out of the residential housing market in the form of a new land transfer tax - and who will suffer when he really does dare, as he is likely to do.
Earlier this year, the mayor's "revenue tool" consultants estimated that a 0.5-per-cent tax on land transfers in Toronto would raise more than $100-million, and could be piggybacked on an identical 1.5-per-cent provincial tax with little fuss or cost. That's a handy little gold mine. So why stop at half a point? Matching the provincial tax would raise $300-million for the government responsible for actually servicing the properties in question - and there are powerful reasons for it to do just that.
Going for the gusto won't make any voters angrier than they already are, but it will make a huge difference to city finances. When the time comes to judge the big grab in the 2010 election, it will be as old as Finance Minister Greg Sorbara's useful health tax is now. Most enticingly, a majority of taxpayers will never pay the new land-transfer tax.
How many property owners intend to move imminently? How many actually do move? And who really pays when the cost of moving up goes up? If buyers are discouraged by land-transfer taxes, they can always lower their purchase offers - and hope, despite the odds, that everybody else feels the same way. If they succeed, prices go down. If they don't, somebody else will be happy to pay. The invisible hand will work things out (i.e., will capitalize the tax). Unlike their avid agents, sellers will hardly notice the extra slice off their windfall profits
If they care to think it through, most ratepayers will realize that the new tax will actually save them money. A land tax is a price of entry, not an ongoing cost of living. Raising money that way will lessen the need for more assessment-based tax hikes every year. It's a way to shift the tax load onto others in order to relieve the suburban anti-tax zealots who are now complaining about it. If they would only behave themselves long enough to let the treasurer spell it out, they'd shut right up.
The only real victims of a new land tax will be developers and real-estate salespeople. What's the harm in that?