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Property Taxes Set to Skyrocket thanks to McGuinty(March 17, 2008 -- Queen's Park Report) -- On January 1, 2008, the McGuinty government lifted its three-year freeze on property assessments, which will soon result in a triple whammy of assessment increases. The Premier conveniently punted the issue off until after the 2007 election, leaving homeowners to deal with the fall out in 2009. But like putting a lid on a boiling pot of water, the effects of that decision are now spilling over and homeowners in Simcoe-Grey will be receiving three years of assessment hikes all at once. The provincially administered Municipal Property Assessment Corporation (MPAC) assesses the value of the over 4.5 million properties in Ontario on a yearly cycle. The value given to a property by MPAC is then used in coordination with local property tax rates to calculate the taxes that individuals, companies and families must pay on their homes or businesses.
An average town in Simcoe-Grey experienced a 14% increase in the assessed value of a single detached home between 2003 and 2005, or 7% a year. According to MPAC the average house was valued at $207,759 in the town in 2005.
Thanks to the McGuinty freeze on assessments, if the value of a home continues to go up by 7% annually and the tax rate remains the same, homeowners in certain areas of Simcoe-Grey can expect to pay an additional $558.46 in property taxes in 2009.
If the additional $558 in property taxes is not bad enough, the potential for accelerated increases in the value of property all over Simcoe-Grey relative to the previous assessment, could see the $558 increase grow even larger. To make matters even worse, as many real-estate agents will attest, the demand for housing in Simcoe-Grey has expanded dramatically because of the Greenbelt over the last three years.
While increases in assessments are difficult to predict, one certainty is that the fall-out from the McGuinty freeze will hit working families and businesses hard in the pocketbook. As I said during the election, Dalton McGuinty dithered, delayed and denied action when property owners were faced with legitimate concerns about rising property assessments.
A more effective policy would have been to cap assessment increases at 5% while the recommendations made by the Ombudsman were implemented, something that the PC Party advocated in the last election. A five percent cap would have at least spared much of the shock home owners will encounter when they get their property tax bills in 2009, leaving them scrambling to makeup for the huge increase.
Thanks to yet another example of Liberal mismanagement and shortsightedness, the people of Ontario can expect to pay more property taxes in 2009. When will the government alert itself to the appalling condition of our property tax system and recognize that the hardworking people of this province deserve to keep a larger portion of their hard earned money? For the homeowners Simcoe-Grey and all over Ontario, it seems that the answer to that question cannot come soon enough.