FPTV ep. 6: The Property Tax Issue, pt. 1: The Homestead Act

Ontario's current property taxation system requires the value of each taxed home to be assessed. Allegations that the Municipal Property Assessment Corporation has made unfair or erroneous evaluations of the values of homes recently led the Ontario government to freeze property values until after the general election of 2007. In 2006, Ontario PC MPP Tim Hudak proposed a 5% cap on the annual increase in the deemed value of homes. PC leader John Tory has made it clear that the 5% cap is to be a major plank in his party's 2007 election platform.

In this first of a two-part episode of FPTV, Freedom Party of Ontario leader Paul McKeever examines Hudak's proposal, and explains how it would cause problems without addressing the fundamental problems associated with property taxation.

Category:

News & Politics

Tags:

• property
• tax
• assessment
• mill
• rate
• homestead
• act
• cap

[fpontario]

"merely"?

The term "mill rate" is commonly used. A mill rate is a tax rate expressed in parts of 1000 (mill refers to 1000).

As for windfalls: that is the nature of a property tax. Capping a windfall at 5% per annum does nothing to stop the fact that: it is still a windfall. The problem is not how quickly the town gains a windfall: it is that the town is getting the windfall at all. See part 2.

[ourearthhome]

There is a way to "fix" the property tax(PT). The PT taxes two things, improvements and land. Improvements get their value from human effort and investment in materials. Land not being man made gets its value 100% from the community as a whole. Population and public services create and increase land value. If the PT tax was only on land value most homeowners would pay far less because they now subsidize vacant land speculators and those who do not maintain their improvements like slum lords.

[thebear99]

This is an excellent overview of how municipalities tax people. Everyone should watch it. It also explains how stupid the Hudak iniative is.

The Hampton plan is even nuttier than the Homestead Act.

But re: municipal taxation. The thing is, that this money pays for important local services. The taxation in itself is not bad. What's bad is that few people really take the time to see where their municipal taxes go or to make sure that they aren't wasted.

[BigDaddyDishrags]

You are right, the term "mill rate" is commonly used, just not in Ontario. It means an amount of tax per thousand currency units of property value (taxes are calculated by multiplying the assessed value of the property by the mill rate and then dividing by 1,000). In Ontario, we have "tax rates" which are simply a percentage of the assessed value.

[BigDaddyDishrags]

It's not called a mill rate, (hasn't been for many years) it's called a Tax Rate. In your example of the municipality with two properties where one increases in value, the tax obligation of the property whose value remains static does not go down as you indicate. Unless there is a decrease in the tax rate, value increases merely mean a windfall for the municipality.