Comment 36430

By A Smith (anonymous) | Posted December 17, 2009 at 14:36:27

Highwater >> We have low rent in a beautiful location.

You only have low rent because nobody else wants to locate here. If businesses could make more profits in Hamilton, do you think your rent would be as low as it is? No, they would be bid up by the marketplace. Therefore, celebrating Hamilton's low priced rental market is really just celebrating the fact that Hamilton is a bad place to make money.

Where I agree with you regarding taxes is that they should not be lowered if the result is more poverty, but this wouldn't be the case if the city moved to a progressive tax system. Leave the top rates where they are, but exempt the first 50k of property value from taxes altogether. This would put areas of the city which have seen the biggest decline in demand back in the game.

For example, if you owned a 100k home, your tax rate would fall from 1.59% to 0.795%, a 50% reduction. In contrast if you owned a $300k home, your tax rate would only drop from 1.59% to 1.325%. Therefore, by embracing a progressive property tax system, the city would preferentially target tax breaks to those property buyers who bought up the least loved properties.

The net effect of this progressive property tax system would be to constantly reward those who bought into areas which need the most investment. In contrast, the system we have today rewards those who need the least help, communities like Ancaster and Dundas.

Which system do you prefer Highwater, a flat tax, where poor people pay the same tax rate as rich people, or a progressive tax rate where tax breaks are targeted towards run down areas?

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