Someone call Ramit Sethi from Netflix’s How To Get Rich, because Canadian cities need financial rescuing.
Driving the news: Faced with $46.5 billion in budget pressures over the next decade, Toronto is asking the province to approve a new city sales tax to drum up more revenue.
Catch-up: It started with city officials trying to dial back the costs of Canada Day festivities. Now, they’re escalating efforts to tackle what they say is an "unprecedented financial crisis."
- If the province doesn’t give its permission (or offer a financial lifeline itself), Toronto is also looking into raising land-transfer taxes, vacant homes taxes, and parking fees.
Why it’s happening: With the exception of Calgary, Canada’s major cities are super broke. Just how broke? We’re talkin’ collective budget shortfalls totalling well over $1.6 billion.
- Toronto by far has the largest shortfall of nearly $1 billion, followed by Vancouver’s $500 million, Montréal’s $80 million, Winnipeg’s $70 million, and Ottawa’s $12 million.
- Cities are pretty limited when it comes to the ways they can generate new revenue, between budget cuts, tax hikes, and higher fees for services like transit or pools.
Why it matters: If Ontario green lights a Toronto-specific sales tax, it could pave the way for other struggling cities—including Vancouver, Montréal, Ottawa, and Winnipeg—to follow suit.
Zoom out: Shrinking municipal funds could force Toronto to turn to other drastic measures, from pausing transit projects to cutting back plans to bolster long-term healthcare.—SB