Do Torotonians pay high taxes? First, “high” compared to what? Second, the question might be better phrased as, “Do Torontonians get good value for the taxes they pay?”

What Do Torontonians Get for Their Taxes?

In answer to the first question, Toronto’s taxes fall somewhere between New York City’s and Chicago’s, in one Canadian’s rough estimate. It’s very hard to get an apples-to-apples comparison without making this a master’s thesis so let’s rely on his web-post analysis.

The answer to the second question is more convoluted. Here’s some background.

Sri Lankan Festival at Harbourfront

First, the funding story: Torontonians, as Ontario residents, pay the HST of 13% on most goods and services. HST stands for “harmonized sales tax” and represents the sum of national and provincial value-added taxes. A portion of this tax comes back to Toronto from Ontario as various grants and program funds. Toronto relies primarily on property taxes to fund local government and has an annual operating budget of about $10B. Property taxes approach 0.8% of property value per year–this includes school and municipal operations (Brookhaven property taxes are about 1.2% of property value)–contributing around $4B or 40% of the annual operating budget. Provincial transfers amount to about $2B or 20%, with fees, federal funds, and other revenues making up the balance. This equates to about about $3,800/citizen (pop. 2,615,000).

By comparison, Atlanta’s 2013 operating budget is $542M, or $1,290/citizen (pop. 420,000) while Brookhaven’s is $16.5M, or $335/citizen (pop. 49,000).

This is not an apples-to-apples comparison as Toronto provides social services, amounting to 1/3 of their budget–services that are largely funded by the state and federal government in Georgia. After accounting for this, Toronto’s per citizen expenditure is still about twice that of Atlanta.

Harbourfront along Lake Ontario shoreline

Do Torontonians consider this a good value? Hah! That depends on whom you ask, of course. They grumble about taxes just like most Atlantans. They are very proud of their city, however, and tend to stay put, and look forward to showing it off to the world when they host the 2015 Panamerican Games. They are also, along with other Canadians, very proud of their health care system (which is federally funded), and, according to Ms. Pendergrast, view the US debate on Obamacare with puzzled amusement.

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