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July 6, 2021

Toronto Should Cut, Not Hike, Land Transfer Tax 

  • Toronto City Council should reduce rather than increase the land transfer tax (LTT) on high-end homes.
  • Authors Benjamin Dachis, Bev Dahlby and Jack Mintz find any move to increase the tax would have a high economic cost because the LTT discourages people from moving to more favourable locations or housing when they can do so.
  • When combined with the provincial LTT, the authors find that the current combined rate of 5 percent on homes in excess of $2 million is highly distortionary and is close to the rate that maximizes total LTT revenues for the city and province combined. Any further increase in the top LTT rate by Toronto, while increasing its own revenues, would reduce the government of Ontario’s LTT revenues by more than Toronto’s.
Benjamin Dachis
Benjamin Dachis

Benjamin Dachis is Director of Public Affairs for the C.D. Howe Institute. In his role, he furthers the Institute’s mission to improve Canada’s economic performance by enhancing the visibility, reputation and impact of its research and activities. Benjamin started with the C.D. Howe Institute in 2006 as a Research Fellow and also has experience with major U.S. and U.K. think tanks.

Bev Dahlby
Bev Dahlby

Bev Dahlby is a member of the Fiscal and Tax Competitiveness Policy Council and a Fellow-in-Residence at the C.D. Howe Institute. He is also a Research Fellow at the School of Public Policy, University of Calgary.

Jack M. Mintz
Jack Mintz

Dr. Jack M. Mintz is a Senior Fellow of the C.D. Howe Institute. He is also the President’s Fellow of the School of Public Policy at the University of Calgary, after serving as the Palmer Chair and founding Director from January 1, 2008 to June 30, 2015.