Council passes new vacant home tax

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One per cent penalty to start in 2024. City staff estimate that 1,135 properties in Hamilton are currently vacant. 


In a 10-5 vote on Wednesday, January 25, 2023, Hamilton City Council voted to have municipal staff prepare and implement a new vacant home tax.

Starting in 2024, the bylaw will require vacant property owners to pay a one per cent tax. The tax will be specific to properties that have six units or fewer and are vacant for more than 183 days of the calendar year.

Some exemptions apply, such as deaths or hospitalizations of a homeowner or major renovations.

City staff estimate that 1,135 properties in Hamilton are vacant, although some say that those estimates are inflated to justify the tax.

The program will cost the city $2.6 million to implement and will reportedly have an annual operating expense of $2.2 million. Among those costs includes the city hiring 16 full-time staffers to administer the program.

Despite that, the city expects the program to generate a net income of $3.3 million between 2023 and 2028, although the numbers beyond that time period are unclear and the program could eventually run at a deficit if the number of vacant units significantly decreases. 

Essentially, if the tax does what it is supposed to do (i.e. reduce the number of vacant homes/units) then the program could end up costing the city money.

The tax is meant to encourage owners to rent out or sell their empty properties, thus increasing the housing supply to combat rising home prices and rental rates.

The final bylaw governing the program is expected in November 2023, before the 2024 implementation.

So far, Vancouver, Toronto, and Ottawa are the only other Canadian cities to have a vacant home tax planned or implemented.

The vacant home tax motion was drafted by Councillor John-Paul Danko. The other nine Councillors in favour of the tax were Councillor Maureen Wilson, Councillor Cameron Kroetsch, Councillor Nrinder Nann, Councillor Tammy Hwang, Councillor Jeff Beattie, Councillor Mark Tadeson, Councillor Craig Cassar, Councillor Alex Wilson, and Councillor Ted McMeekin.

The five against the policy were Councillor Matt Francis, Councillor Tom Jackson, Councillor Esther Pauls, Councillor Brad Clark, and Councillor Mike Spadafora.

Hamilton Mayor Andrea Horwath recused herself from voting on the policy.

The Councillors against the vacant home tax noted the “risk on taxpayers” and “issues with recruiting and retaining staff” at a time when the city is already having staffing problems.

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