City Budget & Property Taxes

Who's Responsible for What?

Municipal

BudgetTO

Provincial

Municipal Act (2001)

Assessment Act (1990) Regulation

Municipal Property Assessment Corporation (MPAC)

Education Property Tax Rates

Federal

The City Budget is about working together to build a safe, caring and affordable city where everyone belongs.

Each time you visit a recreation centre, borrow a library book, have your recycling picked up, drink clean water from the tap, ride the TTC or have emergency services rush to your aid – you are using one of many City of Toronto services.

The budget is a financial plan that describes how much money the City will raise and spend. It determines the level of service provided to Toronto residents and guides decisions on what City infrastructure will be built and repaired.

Operating Budget

The operating budget covers day-to-day spending on services such as recreation programs, parks maintenance, public health, roads, transit, police and other emergency services. Approximately 32 per cent of the funds for the operating budget comes from property taxes. The remainder comes from provincial grants and subsidies, as well as user fees.

Capital Budget

The capital budget funds the City’s infrastructure that supports service delivery. It pays for the construction and repair of transit, roads, bridges, parks and public buildings such as libraries, community centres and fire stations. The City updates and presents a new 10-year Capital Budget and Plan each year as part of the budget process. The capital budget is primarily funded from reserves, development charges, other orders of government and by borrowing funds.

Rate-supported Programs

The City also has three rate supported programs: Solid Waste Management Services, Toronto Parking Authority and Toronto Water. These programs are funded almost entirely by user fees. For example, water and solid waste fees are calculated by how much water is used and the size of the garbage bin. In turn, the revenue collected from these user fees pays for the services that are provided and the infrastructure to deliver them.

Balancing the Budget

The City is required by provincial law to balance its operating and capital budgets each year – which means that the money spent must be equal to the money raised. To balance the budget, the City can either increase its revenues using tools such as property taxes and fees, or by managing expenses by changing or reducing the cost of services.

Seniors, persons living with a disability, charities, ethnocultural centres, and heritage property owners may be eligible for tax relief programs.

Jump to section:

Seniors and Persons Living with a Disability
Registered Charities
Small Business Property Tax Subclass
Ethnocultural Centres
Heritage Properties

1. Seniors and Persons Living with a Disability

Property Tax Increase Cancellation Program

To qualify for a cancellation of a property tax increase, you must:

have a combined household income of *$55,000 or less
have a residential assessment of *$975,000 or less
be 65 years of age or older, OR
be 60-64 years of age and be in receipt of an Allowance under the Old Age Security Act; if widowed, be in receipt of the Spouse’s Allowance under the Old Age Security Act, OR
be a person living with a disability and be in receipt of disability benefits

Property Tax Increase Deferral Program

To qualify for a deferral of a property tax increase, you must:

have a combined household income of *$55,000 or less,
be 65 years of age or older, OR
be 60-64 years of age and be in receipt of an Allowance under the Old Age Security Act; if widowed, be in receipt of the Spouse’s Allowance under the Old Age Security Act, OR
be 50 years of age or older and be receiving either a pension or a pension annuity resulting from a pension plan under the Income Tax Act (Canada), OR
be a person living with a disability and be in receipt of disability benefits

Water Rebate and Solid Waste Rebate Programs

have a combined household income of *$55,000 or less
be 65 years of age or older, OR
be 60-64 years of age and be in receipt of an Allowance under the Old Age Security Act; if widowed, be in receipt of the Spouse’s Allowance under the Old Age Security Act, OR
be 50 years of age or older and be receiving either a pension or a pension annuity resulting from a pension plan under the Income Tax Act (Canada), OR
be a person living with a disability and be in receipt of disability benefits

Water Rebate Program

To qualify for a rebate on the water consumption portion of your utility bill, you must:

consume less than *400 m³ annually
have metered water service in your home

Solid Waste Rebate Program

To qualify for a rebate on the solid waste portion of your utility bill, you must:

be billed for a small, medium or large garbage collection bin, or
be a single-family residential bag-only customer

2. Registered Charities

If you operate a registered charity, you may be eligible for a rebate of 40 percent of the property taxes paid if you meet the eligibility requirements:

To be eligible, you must:

be a registered charity under subsection 248(1) of the Income Tax Act (Canada) and must have a valid Canada Revenue Agency BN/Registration Number.
own and occupy the commercial or industrial property for which the rebate is being sought, or be a tenant and occupy the commercial or industrial property for which the rebate is being sought.
agree to supply any additional information requested by the City to substantiate the application
ensure tax or other charges for the prior year(s) are fully paid

3. Small Business Property Tax Subclass

The tax rate reduction for eligible properties within the small business subclass is 15 percent of the commercial rate. For properties located within Downtown and Central Waterfront, Growth Centres, and/or Avenues (Appendix 1, Page 34):

Property must be classified within the Commercial or New Commercial Property Tax Class (CT or XT classification), with certain property types excluded.
Current Value Assessment (for 2024 taxation year) must be $10,000 or more and $7 million or less.
Lot size must be 7,500 square feet or less
or
Gross Floor Area (GFA) of 2,500 square feet or less (applies only to commercial condominiums).

The following property types are not eligible to be included in the Small Business subclass: Properties classified within the office building, shopping centre, parking lot and vacant land classes, land already classified within the Creative Co-location Facility subclass or Vacant Land subclass, property that does not contain an affixed building or structure, and land for which a demolition permit has been issued.

4. Ethnocultural Centres

If you own or lease a property that is being used as an ethnocultural centre, you may be eligible for a property tax rebate.

To be eligible, you must:

use the property for ethnocultural activities
own or lease for a fixed term of 60 years or more and occupy the property
ensure tax or other charges for the prior year(s) are fully paid
be a registered charity under subsection 248(1) of the Income Tax Act (Canada) and must have a valid Canada Revenue Agency BN/Registration Number.

5. Heritage Properties

Your property is eligible to apply for a Heritage Property Tax Rebate if it meets the following requirements:

The property is classified as commercial and industrial for property tax purposes, where 50 percent of the current value assessment (CVA) is applied to the calculation of commercial or industrial taxes.
The property is designated under the Ontario Heritage Act
- If designated individually (under Part IV of the Ontario Heritage Act), the property must be subject to a Heritage Easement Agreement, or the property owner must be willing to enter into a Heritage Easement Agreement for the purposes of the Heritage Property Tax Rebate Program;
- If designated within a Heritage Conservation District (under Part V of the Ontario Heritage Act) the property must be identified as contributing to the District and must be subject to a Maintenance and Conservation Agreement, or the property owner must be willing to enter into a Maintenance and Conservation Agreement for the purposes of the Heritage Property Tax Rebate Program;
The property owner plans to complete, within a single taxation year, eligible work equivalent to a minimum of 20 percent of annual property taxes paid.
The property is not subject to any contraventions, work orders, outstanding municipal fines, arrears of taxes, fees or penalties.
The heritage building has not been substantially or completely disassembled, reconstructed, or relocated from its original property.
The heritage property includes all facades facing a street or open space.

How Your Property Tax is Calculated

How MPAC Assesses Property

How MPAC Assesses Business Properties

Frequently Asked Questions

How much will the increases cost residential property owners?

To meet significant budget pressures, the tabled budget proposes a property tax increase of 9 percent for residential properties and 4.5 percent for multi-residential properties. The increase amounts to an additional $374 for the average assessed value of a Toronto home.

A 1.5 percent increase to the City Building Levy is also planned to fund housing and transit needs, an additional $50 for the average assessed value of a Toronto home.

For the average Toronto household using 230 cubic metres of water per year, the water and wastewater consumption 3 percent rate increase will cost an additional $30 annually (eight cents per day), for a total of $1,039 in 2024.

The three percent rate increase to the annual solid waste fee for a single-family household will be $8.60 for a small bin (for a total of $295.29), $10.44 for a medium bin (for a total of $358.47), $14.18 for a large bin (for a total of $486.86) and $16.45 for an extra-large bin (for a total of $564.71).

How can I get involved in the 2024 Budget process?

For the first time in over 12 years, Mayor Chow re-introduced Pre-Budget Community Consultations.

If you wish to participate and have your voice heard in the budget process, I encourage residents and businesses to join one of three telephone town halls :

Tuesday, January 16 - 7:00 pm to 8:30 pm
Wednesday, January 17 - 7:00 pm to 8:30 pm
Thursday, January 18 - 7:00 pm to 8:30 pm

The Budget Committee will also hear speakers in person and by video conference on Monday, January 22, at Toronto City Hall, Committee Room 1, 100 Queen Street West, at the following times:

9:30 am to 12:30 pm
1:30 pm to 4:30 pm
6:00 pm to 9:00 pm

Speakers are asked to register by email: [email protected] or call: 416-392-4666 by 4:30 pm on Monday, January 16. The meeting will be streamed live on the Toronto City Council YouTube channel. Written comments can be submitted to the Budget Committee by email: [email protected] or by mail: Attention Budget Committee, Toronto City Hall, 100 Queen Street West, 10th floor, West Tower, Toronto, ON M5H 2N2.

Why don’t you just sell off city assets?

Selling city assets can sometimes appear as a fast and easy solution for bridging budget gaps. However, it's essential to understand that this approach is short-sighted and not fiscally responsible in the long term.

Firstly, when the city sells an asset, it's essentially a one-time deal. This might lead to temporary financial relief, but it doesn't provide a renewable source of income. Once an asset is sold, the city cannot benefit from it again in the future.

Secondly, public assets often generate ongoing revenue. For example, a public parking lot contributes regularly to the city's budget through parking fees. If we were to sell this asset, we would lose this reliable income source.

Moreover, controlling public assets allows us to prioritize the social and public good over private profit. Once an asset is privatized, the main aim becomes profitability rather than serving the citizens. This could lead to increased costs for the public and potentially decreased accessibility and quality.

Finally, selling assets can lead to less transparency and less public accountability. Governments are accountable to their citizens for managing public assets. When we sell these assets, we lose oversight and control.

While selling assets might provide a quick fix, it doesn't support our longer-term fiscal responsibilities. Instead, we should focus on finding sustainable solutions to manage our budget wisely while continually serving the city's and our residents' best interests.

Why don’t you cut division budgets/reduce spending?

While it is crucial to seek ways to improve and find efficiencies, the reality is that the City of Toronto has been operating at a near-starvation level for several years, with taxes kept at or below inflation. City divisions have been in a mode of expenditure reduction for the past 12 years, resulting in various constraints.

For instance, hiring freezes have been implemented, preventing the addition of new employees to aid in our city's growth and development. We've also struggled to pay competitive wages in today's market, which can limit our ability to attract and retain top talent. Numerous critical projects have also been deferred because we do not have the resources to implement them.

Many residents have voiced their concerns to me about these issues. They see the effects of our limited resources in the form of inadequate bylaw enforcement and cleanliness standards in our streets and parks.

To address these growing issues and get our city back on track, we must start investing in our priorities rather than cutting them. We must bolster our housing initiatives, improve and expand our transit system, and enhance other crucial city services that residents rely on daily.

A cost-saving mindset has its place, but it is also important to remember that our city's success, vibrancy, and livability rely on strategic investments. These are investments in our future and the legacy we leave for the next generation.