Home and Mobility Taxes

Let’s review a recent Toronto Star article Drinks, movies among tax targets (John Spears, 07.03.27), which contains several skewed sound-bites and implications about road pricing. So from the top…

The article is about taxes. Raising a sorely needed $340M for our impoverished city. The alcohol part is 18% and the movie part is 1%. But the land-transfer, road tolls, vehicle registration surcharge, and parking surcharge portions are 30%, 13%, 12% and 2% respectively – i.e. 19% for drinking while watching a movie and 57% for driving to work so you can pay your mortgage.

This sounds like a formula for … what? This is even dumber than communism.

So first, John, let’s change your title to “Your home and mobility among tax targets”.

Since you know I am advocate of congestion pricing, you might think I’d be delighted.

I’m not. The stated intentions for are clearly for raising revenue (that part is good), but they are ONLY for raising money. That part is absolutely irresponsible when the power of taxation is as misapplied to road tolls, vehicle registration, and parking as this article and several others on this budget suggests.

Moving on: “[m]any of the proposed levies are "sin taxes"… Well alcohol and tobacco is 27% of this, entertainment and billboards, is 6% and the rest, 57%, is your home and car – hardly sinful possessions.

So let’s rewrite that as “A minority of the proposed levies are ‘sin taxes’; the rest are a straight misapplication of progressive taxation theory.

Councillor Shelley Carroll apparently said [these tax proposals] “signal that the city has reached the limit of what it can finance through property taxes.” Full marks to Councillor Carroll.

Councillor Doug Holyday apparently said “the city shouldn't be looking at any new taxes: ‘You want to drive our businesses out of the city, this is the way to do it…’" I don’t see how the city can avoid its responsibility to find new revenue, so that portion of his remark is at best misleading. However, he is right that doing it the way described will drive people away. So if Miller wants to “invest in city building” lets avoid regressive taxation measures. Half marks to Councillor Holyday.

Councillor Gloria Lindsay Luby is right to suggest that “introducing tolls on the Gardiner [amounts] to erecting a gate at the city's border”, but she did not point out that that’s because it is the wrong approach to road tolling. That is how you toll for road building – not for congestion.

Luby was unhelpful to say, “To hell with the economic impacts of these things, we're just going to close ourselves off. I don't think that's the way we should go." I would rather the Councillor just repeat Mayor Miller’s brilliant insight: “Tolling has to be regional” – a comment that earns Miller an A+ in the grushhour playbook.

Fortunately, Luby redeems herself somewhat when she says "I don't know that it is worth trying to get the (public consultation) going in the community unless they understand what the economic implications are." She is soooo right, but I also doubt most of our politicians really understand the full implications of a properly designed and coordinated congestion pricing scheme – one that is regional, graduated, congestion sensitive, and, in sufficient scope, with fuel tax rebates – that supports both road building and transit. C+ for Councillor Luby.

Faye Lyons (CAA) noted that “too many of the proposed taxes hit drivers.” I’d give her higher marks if she had said “all of these automotive levies are regressive, hence would have no effect on congestion”. I am sure that her constituency would prefer any additional tax burden to reduce congestion as a return on their new “automotive investment.”

Ms Lyons said "Motorists are an easy target for this council," which is correct, but she is way off the mark to say “motorists are already overburdened and overtaxed”. Property owners subsidize roads. Motorists’ are in fact supported by every pedestrian, bicyclist and transit user that owns or rents taxed property in this city. If you are not a motorist and not homeless you are the one who is “already overburdened and overtaxed”.

Ms Lyons also said: “tolls on the Gardiner or DVP would only force more cars onto residential roads, causing traffic jams, air pollution and accidents.” She is right, but she does not offer the fuller Millerian insight: “Tolling has to be regional”. Faye Lyons gets a D.

I just wish Mayor Miller would finish that little sentence of his: “Tolling has to be regional, and I am going to push hard for that at every ‘smart-everything’ and green-everything’ meeting I attend”.

Without that degree of courage and conviction, Mayor Miller looses marks. C-. Actually D-, since he’s our leader.

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