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Side Effects of The New City of Toronto Act

In today's news is an early sign of the sorts of things I have been warning about regarding the New City of Toronto Act.

Although the City doesn't stand to benefit financially from the new law, it is the perfect excuse to withdraw from helping Toronto out of the fiscal problems it has faced since the Harris-era downloadings and amalgamation.

The 905-area municipalities are saying that the CoTA is reason to free them from GTA-wide social services pooling. They say that new taxing powers for the City of Toronto mean that the other municipalities shouldn't help.

Well, the whole reason for pooling in the first place had to do with the unfair downloading of social services onto the municipal property tax base. It makes no sense that the City of Toronto should have to pay for social services provided to people who have moved to the city from across the country and around the world while residents of Mississauga or Markham are off the hook. The differential that would cause in property tax rates would be a powerful incentive for further sprawl and a spiraling decline for the City.

The City of Toronto Act will let the City raise all sorts of new fees and taxes on different little things. Theoretically that would help the City to balance its budget, but it doesn't address the problem whatsoever. There's only one taxpayer, after all. The 905ers' plan would still mean that a Torontonian is paying for provincially-mandated services while someone across the city line is not.

The real solution is to upload social services to the provincial level so that they can be paid out of income taxes instead of municipal property taxes. That's the only thing that makes sense.

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