Toronto one step closer to making luxury homebuyers pay more in land transfer taxes
CBC
Toronto is one step closer to making luxury homebuyers pay more in land transfer taxes after a city council committee endorsed the mayor's plan for a hike beginning in April 2026.
At its meeting Tuesday, the executive committee voted in favour of a hike in the municipal land transfer tax (MLTT) on houses valued at more than $3 million to more than $20 million.
The proposed rates would rise gradually as the value of homes increases, according to the mayor's motion. Toronto last approved an increase in municipal land transfer tax rates for multimillion dollar properties in 2023.
Mayor Olivia Chow told reporters at a news conference before the vote that people who can afford luxury homes can afford to pay more in tax. She said there is no downside to taxing wealthy people who can afford such highly valued homes.
"It doesn't impact the 98 per cent of people buying homes," Chow said. "This measure makes life more affordable and easier for middle class and working folks who are having a hard time making ends meet."
The revenue will help the city keep TTC fares low, fund the school food program and build more affordable rental homes, Chow said.
The plan must still be approved by city council, which meets next week.
In a letter to the executive committee, Chow wrote: "I’m asking the two per cent of buyers purchasing luxury homes far beyond what average Torontonians can afford to chip in more. Those who can afford five or ten million dollar homes can afford to pay their fair share."
The tax increase would work on a graduated scale:
The plan, however, is facing opposition.
Jason Mercer, chief information officer at the Toronto Regional Real Estate Board (TRREB), said increasing the municipal land transfer tax would add to the upfront costs of buying a home.
In Toronto, homebuyers pay a provincial land transfer tax and a municipal land transfer tax.
"It's unfair because you're talking about a lot of households in the city of Toronto that have every intention of purchasing a home but are still finding it unaffordable, and that's with lower selling prices and lower borrowing costs. They're still finding it difficult to move into the market," Mercer said.
"Obviously, an upfront tax that impacts both first-time buyers and existing homeowners presents issues."
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