Liberal MP accuses Toronto of 'shakedown' for tax hike threat in bid for federal shelter money

A Toronto Liberal MP says the city is trying to "shakedown" the federal government with its warning that property taxes will go up by 16.5 per cent if Ottawa doesn't come through with more funding for sheltering asylum seekers.

"I find it incredibly disappointing, I find it outrageous," said MP Yvan Baker, who represents Etobicoke Centre, in an interview with CBC Radio's Metro Morning on Wednesday. 

"We've provided funding for not just COVID, but for housing, for asylum seekers, for transit to the tune of billions of dollars per year. This year it will be close to $3 billion."

Baker's comments are the latest volley in a public war of words between Toronto Mayor Olivia Chow's budget committee and local Liberal MPs.

The tensions come after city staff released their proposed fiscal plan for 2024, which recommended a total of 10.5 per cent in tax increases for property owners this year — the single-biggest annual increase since amalgamation in 1998 — as they try to fill a $1.8 billion budget shortfall. 

But budget chief Coun. Shelley Carroll also said if the federal government doesn't provide $250 million for Toronto's straining shelter system, the city will "have no choice" but to impose an additional six per cent "Federal Impacts Levy."

Carroll said revenue from the novel tax would be needed to shelter the 5,800 asylum seekers and refugee claimants who currently account for more than half of the city's shelter capacity. Carroll told reporters this week that the influx is a result of "federal actions and federal policy" and the costs should be "squarely the responsibility of the federal government."

The Toronto Star reported Tuesday that at least some of Toronto's 25 Liberal MPs are furious Chow and her closest council allies are trying to pin a potential tax hike on the federal government. 

Baker said Wednesday that sheltering asylum seekers and refugee claimants has always been a "shared responsibility" and he accused Chow of "misleading the people of Toronto."

"Olivia Chow needs to start telling the truth to the citizens of Toronto about the degree to which the federal government has stepped up," Baker said, pointing to the nearly $5.5 billion the Liberal government has sent to the city since it took office. That includes $97 million last summer specifically for the shelter system.

Baker went on to allege that the city has not been transparent enough about the true costs associated with its shelters. 

"To me, this feels a little bit like a shakedown," Baker said. "I can't support funding going to another level of government, for any initiative for that matter, if I don't have confidence that that funding is going to the cause it's supposed to be going to, that it's the right amount of money, and that it's actually going to help solve the problem."

In a statement posted to X, formerly Twitter, Chow said she's optimistic more federal money will flow.

"Funding and support for refugees is a gap in our budget so we need to address it. All along I've said we have a great partnership and I know the Federal Government and Toronto MPs want to come through for Torontonians, like they have before."