Toronto Mayor Olivia Chow unveiled her version of the 2025 budget on Thursday morning, proposing a 6.9% residential property tax increase as part of her efforts to address the city's pressing financial challenges. This tax hike includes 5.4% aimed at supporting the city’s operating budget, along with a 1.5% levy intended to bolster infrastructure projects. Chow acknowledged the difficulties many residents face, stating, “I understand this is challenging for many across the city.”
To alleviate the impact of the proposed increase, the budget will expand property tax relief programs. Specifically, the income threshold for property tax deferral and cancellation for seniors and persons with disabilities is set to rise by 5% to $60,000. This adjustment is expected to enable thousands more individuals to qualify for assistance. The latest details estimate the average assessed value of homes at $692,031, meaning the tax increase would amount to approximately $210 annually, or about $17.50 each month for homeowners.
The proposed increase also varies across property types, with multi-residential and commercial properties experiencing base increases of 2.7% and industrial properties seeing 5.4% hikes. Chow emphasized the importance of the temporary reduction of multi-residential tax rates, which are set lower than the provincial threshold, thereby preventing landlords from seeking above-guideline rent increases. “At a time when we know renters are already feeling squeezed, this reduction is an important measure,” she noted.
Mayor Chow's proposed budget is fairly consistent with previous estimations. The last year's adjustments under former Mayor John Tory saw higher increases, including last year's record 9.5% hike, which marked the largest such increase since the city's amalgamation.
Chow has pointed at years of financial neglect as the root cause for the current shortfall. “Tough choices have to be made as we continue to climb out of a decade of neglect, and we cannot balance the budget on the backs of cuts to the city services people relied on,” she asserted. The budget, as outlined, contains $680 million set aside for “reductions and offsets,” highlighting the city’s strategy to cut unnecessary expenses amid increasing financial pressures.
A city council meeting is scheduled for February 11, where the property tax hike and the full budget proposal will be on the agenda for review. Chow's administration has stated the need for new funds, with expectations to generate around $320 million through the tax increase to support various city services, including transit, community programs, and emergency response services.
Additional tax changes also encompass the water and garbage fees, which are expected to increase by 3.75%. For Chow, these fees are inseparable from providing the necessary services residents depend on.
Among the budget highlights, the allocation of funds to expand support for vulnerable populations, particularly children and young people, cannot go unnoticed. Chow's budget plans to increase meal programs to benefit 21,500 additional kids at schools and includes financial support for tenant protections and affordable housing initiatives aimed at addressing the affordability crisis. Overall, $1 million has been earmarked for rent bank initiatives, which will help provide assistance for over 2,700 households.
Despite the proposed budget being mere extensions from Lord Tory’s previous plans, it has garnered skepticism from various council members. Coun. Brad Bradford raised concerns, stating he has received multiple emails from constituents expressing the strain of the proposed hike, calling it “very out of touch with the priorities of everyday folks here.”
On the other hand, Chow touts her budget as responsive to constituents, indicating minimal changes have been made since the public consultations and reaffirming her confidence by noting, “What they said really confirmed the proposed budget.”
Another important aspect of Chow’s budget proposal is the extension of service improvements within the Transit Toronto Commission's operations. The announcement of fare freezes for the second consecutive year, along with new subway cars and enhanced travel times on certain routes, has been highlighted as part of her strategy to improve transit reliability.
The mayor also faced criticism from the official youth advocacy group, the Toronto Youth Cabinet, needing more attention to younger populations through financial investments. They claimed the budget falls short, especially for youth programs aimed at employment and violence prevention initiatives. Chow responded to these claims, asserting efforts have been made to build opportunities, including increasing staffing levels within parks and recreation.
Concluding her announcements, Chow stated “The City budget is about choices,” insisting on the necessity of investments to improve the quality of life for Torontonians. “We must choose to fix what’s broken, to build a city where everyone belongs.” This commitment, she argues, is imperative to ensuring future sustainability and livability within Toronto.