Taxation fatigue

Every year, governments on all tiers ask their constituents to dig a little deeper to hand over some of their hard earned money in the way of taxes. Next year, however, residents of Durham Region are being hit with a double whammy.

While councillors have already approved a target maximum increase of two per cent on its share of the 2017 property tax bill, residents are also being hit with the reality of growing home prices. According to new data from the region’s finance department, approximately two thirds of those with residential property can expect to pay more in taxes because of growing house valuations. While the tax increase percentage (remember, two at the max) may appear low, that perceived reasonable increase is thrown out the window when that payment is being based on a property suddenly worth tens of thousands, if not hundreds of thousands, of dollars more than it was last go around.

However, the warning signs have been there for some time, and the powers that be did nothing to stop it. Rather than taking a deeper look at the budget – whether it be at the staff level or via tough questioning from councillors – increases seemed to be passed without much debate. Rather than questioning individual items and asking why taxpayers should be paying for them, increases were passed.

And according to stats from the Canadian Real Estate Association, the average selling price of a home has been on an upward trend since the worst days of the global recession in 2008. Between January 2012, when the previous evaluations were based, and January 2016, prices went up by nearly 50 per cent. And it did not get there overnight – the signs that house values were going to be significantly higher by the time the next valuations rolled around were there for those wanting to find them.

But instead of preparing for it by taking a deep look at the budget, spending went on as normal.

When an average person knows that a big purchase is coming up, do they continue to spend as they always do, or do they cut back on their spending, knowing the money will be there when that big total flashes across the cash register? It’s that common sense approach that seems to be missing at the region – and we are the ones that are going to have to pay for it. Literally.