Business

Queen's Park takes on Toronto, and taxpayers are the losers

On Monday February 13, provincial politicians get back to business with a heavy legislative agenda.  First up: Bill 53 An Act to Revise the City of Toronto Acts, a bill, which has the potential to damage taxpayers well-being not only in Toronto but across the province.

At 296 pages, Bill 53 clocks in as one of the most voluminous pieces of legislation this government has introduced, and certainly one of its most ambitious. The new law is supposed to give Toronto the powers of a world-class city, to regulate its own affairs from speed bumps to bar hours.  Unfortunately, it also gives the city new "revenue-raising tools"--code for increased powers of taxation and regulation, which in the hands of a tax-hungry city council threatens to weaken Torontos competitiveness as a place to live and do business.

Bill 53 specifically opens the door to municipal taxation of entertainment, alcohol and tobacco products.  More worrisome, it also gives Toronto broad powers of regulation and licensing.  A permit for parking spaces?  An annual landlords registration fee? How about a general license to do business in the city?  Under Bill 53, none of these charges are outside the realm of possibility.

It is estimated that these new taxing powers could scrape $50 million a year from taxpayers pockets.  At the same time, the city is projecting a budget shortfall in 2006 of $532 million.

Why is Toronto drowning in red ink?  The city blames its woes on provincial downloading, particularly the costs of providing social housing and welfare.  But the city itself is also heavily to blame.  Torontos spending priorities are completely out of whack, with millions wasted on non-essential items such as beautification projects, cultural grants, a new soccer stadium, and a pay raise for councillors.  The proposed budget also boosts spending at the city clerks office by 46%--the most of any municipal department--just to figure out what Bill 53 means for Toronto!  Talk about inefficiency.

What is the real solution to Torontos problems?  Legislation that both re-evaluates "who does what" and obliges the city to be more fiscally responsible.  This would mean uploading certain services off the municipal property tax base and enacting measures that would prevent councilors from wasting taxpayers money.  For starters, the city should be required to stop discriminating against non-union contractors when accepting bids for services such as waste management and maintaining public spaces.  There is no excuse for paying city workers an exorbitant $17.45 an hour to cut grass in Torontos parks when non-unionized workers could do the job at lower cost.

Bill 53 is going to second reading next week, and to committee thereafter for further input and amendments.  Even if you dont live in Toronto, all taxpayers in Ontario should speak up about this proposed legislation, because it will serve as the model for cities and towns across the province.  Taxpayers should demand that the government either take the new taxing powers out of Bill 53 or put the legislation to a referendum, in the spirit of the Taxpayer Protection Act, which requires that all tax increases be subject to public approval. 

Premier Dalton McGuinty shouldnt be allowed to do indirectly what he promised not to do directly: raise taxes without taxpayers consent.  Ontarians should use this occasion to remind the Premier of his election promise to the Canadian Taxpayers Federation and to voters across Ontario not to increase their tax burden(and call on him to find more fiscally responsible ways of addressing the "fiscal imbalance" between the Toronto and Queens Park.

Tasha Kheiriddin

CTF Ontario Director