Vacant Home Tax in Brampton could help with housing supply
Published May 16, 2023 at 3:14 pm
The Region of Peel wants Brampton and Mississauga to come together to throw their weight behind a proposed tax on homes left empty when they could be rented or sold to residents.
Peel Regional Council authorized staff last month to submit a proposal to the Province Peter requesting the authority to implement a vacant home tax (VHT) tax in Peel.
The proposed 1 per cent tax would only apply to homes left vacant for more than 184 days in a calendar year and could encourage owners of vacant properties to either sell or rent out their empty units, creating more supply of available units and lowering average property sale and rental prices, according to the Region.
Regional Chair Nando Iannicca has asked the mayors of Mississauga, Brampton and Caledon to sign off on the request “to demonstrate a united position” in a letter going to Brampton City Council on Wednesday (May 17).
That unity may be strained with Brampton Mayor Patrick Brown and Mississauga Mayor Bonnie Crombie taking jabs at each other in the last week over a possible move by the province to break up Peel Region altogether.
The push to bring a VHT to Peel comes following an Ernst & Young LLP (EY) report that found the tax could bring some $17 million in annual revenue to the Region, following a one-time implementation cost of up to $14 million and an annual operating cost of about $4.5 million.
“The EY study recommends that a VHT would be a feasible housing policy and revenue-positive tool for implementation in Peel Region to address affordable housing challenges,” the report reads, adding that the firm’s financial analysis estimates approximately 3,000 vacant units could be potentially subject to the tax annually.
If given the go-ahead from the Province, the Region would make a one-time transfer of $15 million from the Tax Stabilization Reserve to set up a Vacant Home Tax Reserve to implement the tax, as well as the hiring of three staff members to facilitate the program.
The first VHT in Canada was introduced in Vancouver in 2017. Since then other cities including Toronto, Hamilton and Ottawa have brought in similar taxes.
The report and letter from the Region will go to Brampton City Council on Wednesday.insauga's Editorial Standards and Policies advertising