Might as well have a single thread regarding this rather then the small tidbits that pop up in other threads and eventually get deleted or shunned as being not related to the given topic.
As a starting point:
As a starting point:
nfitz; said:You sure about that? It was reported this year that the residential tax increased by 2.9%. The residential mill rate itself dropped from 0.6027807 in 2009 to 0.5895702% in 2010; a drop of 2.2% (because property values themselves increased far more than 2.9%). However the commercial rates dropped from 2.0431761% in 2009 to 1.9367482% in 2010; a drop of 5.2%.
To me that looks at though the difference between the drop of the residential rate and the commercial rate exceeds the increase in the total taxes paid, so commercial rates are dropping. Even if frozen compared to residential taxes they are dropping versus inflation.
Not sure I'm missing something, I'm only looking at this, and not something else ...
Glen said:Yes, you are missing the relative changes in assessment values. During the last assessment cycle non residential assessment values increased more than residential ones. As such the mill rate decreases more. You should also note that when this occurs, non residential increasing faster than residential, they city lets it go because it decreases the ratio with little impact on revenues. But when the opposite occurs, they city runs to the Province and gets the minister of finance to prevent "cva related tax burden shifts". Toronto cries that it is unfair to allow tax shifts when residential assessments rise faster than non residential, but allows the opposite to occur.
From June 2004,
nfitz said:Interesting. That does create a dlilemna. And it surprises me, given the amount of vacant commerical lands we see through much of the outer 416 area. Given we don't have acres of residential lands empty, and we do have acres of commercial/industrial lands empty, I'm surprised that market forces are pushing up commercial/industrial lands faster than residential lands. Again, I'm wondering if I'm missing something ... (and I see this in good faith!).
Glen said:Speculation. Many commercial properties have assessment values that poorly related to cap rates (income). MPAC can choose, and does so, to value non residential properties market values instead of based on income. Many non residential properties have a market value that is related to their redevelopment potential (residential). MPAC looks at recent sales, which is influenced by purchases of such sites, and extrapolates the heightened values to other properties. Most office buildings are valued on a strict income approach.
There is also the issue of promised tax cuts. Toronto's high taxes have decreased values. When the city announced the program to reduce taxes, values increased in anticipation of of higher net rents.
One simple step the province could take is to change the way that MPAC values non residential properties to be valued on as is current use (income) basis. This would remove the speculative distortions.
nfitz said:Why were commercial properties not revalued in 2008 when residential properties were revalued?