From Cork to Toronto

Toronto's assumption of a land transfer tax places the city's financing doubly dependent on the peaks and valleys of the property market. The take looks attractive given the strength of a booming market in the City at present. It looked attractive in Cape Coral, Florida too : (The Mayor) was keen to build a new high school. He hoped to widen roads and extend the reach of the sewage system, limiting pollution from leaky septic tanks. He wanted to add parks. But then the US property crash happened, and property revenues crashed with it. What's it like in Cape Coral now? Last month, the city eliminated 18 building inspector jobs and 20 other positions within its Department of Community Development. They were no longer needed because construction has all but ceased. The city recently hired a landscaping company to cut overgrown lawns surrounding hundreds of abandoned homes. “People are underwater on their houses, and they have just left,” Mr. Feichthaler says. “That road wid...

One of the reasons I have been sceptical about the land transfer tax (or "moving tax" ) is that it's hard to budget revenues for a sector that is prone to booms - and serious busts. David Miller should heed the following warning, based on the latest reports from the Irish Department of Finance who call LTT "stamp duty": "The bottom line is that this will be the most difficult budget Brian Cowen has had to preside over," said Alan McQuaid in Bloxham Stockbrokers. The problem is slumping revenues from the reduction in house building and stalled house sales. Stamp duties brought in €400m less than expected and taxes on profits from property sales are more than €100m below estimates. It makes one wonder how much of the current Ontario surplus is built on the Toronto property boom and the land transfer tax take that went with it, and what happens if that boom levels off, or worse still slows down.

A wrongheaded stance , in my view, but their right to be wrong, etc. What got my goat though was the reference to the property market last month: The Toronto Real Estate Board is opposed to the tax, but it recently reported that June's sales volume was the highest ever for that month, with the average property selling for 5 per cent more this year compared to the first six months of 2006. Well, yeah - it would when the tax hasn't come in yet, and I fully expect sales to be as brisk if not more so between here and the year's end - as long as closing dates precede 31.12.2007. A surge in consumption usually precedes the onset of a tax, and a decline in advance of a reduction. Don't try and book a moving truck this Christmas. Toronto is providing at insufficient compensation things that are not its proper responsibility such as social welfare and does not have access to taxes directly linked to growth it creates. A Toronto success is really a federal and provincial succ...

I wonder how much Krusty the Clown (no, not that clown , I mean this one) got for those... anyway, today I heartily endorse nohomebuyingtax.com - the Toronto Real Estate Board's website against Toronto's new and throughly regressive tax grab. Transferring land from one owner to another doesn't cost the city any extra facilities. Building new houses does, which is why development charges are fair. Ironically, one of the few exemptions for first time buyers is purchase new homes - which do add to the strain on city infrastructure. However, only the first $2,000 is exempt on new homes and the tax on an average priced house is about $3,890. If you bought a condo box a few years ago and need more room to start a family, well you better look for a crib that can hang off a balcony railing like a planter or something. I had meant to write about Mike Smith's " if you believe in property ownership you deserve to have the government take your money away and spend it fo...

For Canadians, that's about $0.32 for every plastic bag, which has reduced bag distribution by 90% since 2002 .  The tax had been EUR 0.15 (C$0.22) but an upward bump in plastic bag sales led to this further hike.  No fear of that happening in Ontario or Toronto, as the plastic lobby's frequent wailings in the press seems to head it off any time it's proposed.

" McGuinty vows Liberals won't raise taxes if re-elected ". Uh-huh. While the Health Tax won't be McGuinty's version of the Poll Tax, it should and will hurt him with lower middle class voters. Yes, Ontario had a deficit, how big depends who you ask, but he rammed in this tax without consultation and in such a way that some employers had to swallow it due to old collective agreement dating from the OHIP Premium. The tax discriminates against work, since it taxes two lower incomes more than one large one. I don't object to higher taxes - I object to stupid ones, and especially ones which entail zero improvement in services delivered.

To most Europeans coming from the system of VAT where tax is shown on the "sticker price" to North America where you have to do mental arithmetic to know how much you would pay at the cash register is a bit frustrating. Buying electronics is swiftly making that transition even more annoying. The latest scam is the "mail-in rebate". You open a store flyer and see that a $159 camera is marked down to $70. Good news you think, with tax that's about $80. Then you notice that only $9 of that is "instant savings" and the rest is a mail-in rebate. Well, that's not so bad - you just pay the $150 and tax on the $70 price and you get $80 back in the post. Well, no - in Ontario tax is 14% of the price you paid at the till after store discount. Your "$159 down to $70 camera" means you pay $150+$21 - $171. Then you have to put your receipt in an envelope and send it somewhere. But your rebate may not be what you were promised, since the fine ...

I have to say I had the same reaction as Raiméis when I saw the release of 18 - enough re-releasing of past glories and throwing in the odd new track - we've already got them , sometimes twice over . But they have to have something to shovel money into their Dutch tax haven (and avoid the taxes they want governments to send to poor countries ).

The Telegraph reports that UK Chancellor Gordon Brown plans "green taxes" among which an tax hike on the existing 5 pound sterling tax on shorthaul flights and 40 pounds on longhaul. If Brown had real concern for the environment he would commit to putting all aviation tax above the cost of maintaining aviation infrastructure and security into improving high speed rail links within the UK and to Belgium and France via the Channel Tunnel. Instead the tax will surely pour into the gaping maw of the Treasury. This doesn't make it green - just greedy. Taxes on long haul flights tax on the other hand lacks any alternative route to steer people to short of putting people on rowing boats - paying for facilities to tow and start up aircraft near runways rather than having engines idling on the tarmac should be where such taxes find a home, as well as punishing older aircraft harder than newer more economical ones. There is a case to increase some taxes on flying here in Canada...

Much criticism has been levelled at the Tory Government's decision to use climate change money for the tax credit on monthly fare passes. Some would prefer this money to go directly to the transit authorities. There are however reasons tax deductible transit is a good idea. In Toronto, Metropass use is now cheaper than bulk tokens for a Monday - Friday commuter. For GO Transit users this is already true. Now you've actually got a Metropass, this means you might use it when otherwise the choice is a taxi or car - now there's no incremental cost and it's more responsible in climate terms. If you don't use Metropass out of commute, you are giving TTC about $7 more a month (yearly plan) or $15.75 more with the booth purchased pass than you used to, assuming 40 tokens/month @ 2.10 each bulk price. In the yearly plan, the $91 the TTC gets is actually only about $77 from the commuter and $14 from government which is returned to the commuter at the year end. The more p...

A lot of the reaction to the budget has centred on the politics of it - this surprised me as I was not aware that there were apolitical budgets but with an election possible whenever Gilles Duceppe gets tired of propping up Harper this one has some extra edge. The Tory fiddling with taxes and bands target middle income households with hockey playing kids and stay home parents where the provider gets the suburban commuter train - the base which the Libs have eaten into during the Chretien-Martin years. Indeed, with his attendance at his kids hockey practices Harper has claimed kinship to that base in a way previous Tory grandees would find very difficult. Those who expected the Tories to do more for the poor are obviously expecting the sun to rise up at midnight - the poor don't vote Tory. Neither do city folk or aboriginals. I imagine a lot of it is proforma - the minute the election results starting looking Blue everyone knew what was going to happen next. The transit pass is an...

Apparently the GST cut won't be until July 1st . Canadian small business owners claimed they needed time to convert over. The election was the end of January - you've had three months to prepare already! Some argue that it will depress economic activity as people hold off big ticket purchases. I suspect that's more likely than whatever the hell the Bank of Canada is playing at with interest rate policy. By contrast, the Irish government announced a 1% VAT cut on 6 December 2000 which they implemented 25 days later - a cut that was reversed the following year (with three months notice) due to revenue shortfalls. However, giving notice makes sense when you're raising rates as people can bring forward expenses and thus tax revenue but giving notice when cutting makes no sense. hat tip - Maple Leaf Politics

It's tax season here. The end of year is Dec 31 (pension year end is Feb 28) so people are getting down to it. However, the Tory Federal Budget is on the way and the talk is that Jim Flaherty will be keeping the campaign promise of rolling back the Liberal income tax cut in favour of GST cuts and childcare allowances. Flaherty should learn from Toronto and Ontario, both of whom have encountered money they didn't expect and are showing an unwillingness to reduce unpopular planned TTC hikes in the case of Toronto or reducing the province's deficit in the case of Ontario. Ontario is stashing money for the subway from York to nowhere rather than reducing the regressive health tax. If there really is $1.6 billion beyond previous revenue estimates for 2005 and $3 billion this year, it would be utter foolishness to roll back the Liberal cut unless the Tories see themselves going to the country before July 1st, when the clawback is expected to begin. Any strategist who thin...

I'm sure Joe Mihevc thought he was doing his NDP mates a favour when the TTC commissioner said the Tories 16% tax deduction for transit would merely be the spur for the TTC to hike fares by the same figure . Instead he looked spiteful at the prospect of a looming Harper administration, and while he might have every right to fear it, he may have done his cause more harm than good, at a time when he might have been expected to keep his head down after his less than deft stick-handling of the St. Clair Right-Of-Way. The only surprise is that if a TTC commissioner was likely to say something stupid, it wasn't the Chair . Michael Roschlau, president and chief executive officer of the Canadian Urban Transit Association told the Toronto Star existing vehicles are full up at rush hour . Someone should tell the TTC to stop adding riders . My thinking on this is that a tax credit gets people out of cars. This is a good thing - people who can afford to park downtown definitely p...