Last Wednesday, Hamilton City Council voted 8-6 to approve a recommendation from staff to extend the city’s controversial Vacant Unit Tax for another year.
Hamilton Mayor Andrea Horwath did not vote on the Vacant Unit Tax and has not done so since the initial vote on the tax back in January 2023 since she has reportedly owned a vacant unit throughout that entire time.
Horwath instead declared a conflict of interest.
Councillor Esther Pauls (Ward 7 – Central Mountain), who has regularly voted against the Vacant Unit Tax, was absent from the vote, but her presence would not have changed the result.
As such, the Vacant Unit Tax will be collected by the city in 2027 based on the 2026 occupancy of residential units.
The tax applies to any property that is classified as residential, has six or less units, and has been unoccupied for more than 183 days.
The tax rate is one per cent of the unit’s current assessed value.
The average Hamilton home is assessed at $386,600, so a Vacant Unit Tax on the average property would cost $3,866.
Councillors who have voted against the tax have noted that the vast majority of those being charged are simply those whose units were deemed vacant “due to non-submission of the occupancy declaration.”
Councillors have pointed out that individuals who did not respond to the city but automatically became subject to the tax might face specific barriers.
These could include seniors, residents with language barriers, or individuals who either never received the notification or accidentally lost it in their mail.
On the other hand, Councillor Craig Cassar (Ward 12 – Ancaster-West Flamborough) told the General Issues Committee that the city should continue to collect the tax even if there are “negative impacts.”
“I understand that there’s opposition to it and, you know, it has negative impacts and we need to minimize those,” he said.
“But part of improving the entire city is to deal with the homelessness problem. And we’ve said many times, I think all of us have said it, it shouldn’t be on the backs of property taxpayers,” Cassar continued.
“Should it have to come from a Vacant Unit Tax? Not necessarily. It should come from upper levels of government, but we don’t have that luxury at this point in time. So, you know, it’s not a perfect process, not a perfect decision, but it’s something that we have to do and I’ll continue to support it and look forward to deliberating ways to improve it,” he concluded.
Councillor Rob Cooper (Ward 8 – West/Central Mountain), who is running for mayor in October’s municipal election, claims that the Vacant Unit Tax is having a “chilling effect” on development in Hamilton.
“What I have been hearing is that this is really having an impact on whether people develop in Hamilton or not,” he said.
The Vacant Unit Tax applies to new residential homes of six units or less, although there is a six-month exemption for new builds before vacancy starts being counted.
If new homes fail to sell right away, a developer would have to pay the tax.
A staff report presented to Council also provided an update on collection activity from the first two years of the Vacant Unit Tax.
YEAR 1 – 2024 VACANCY YEAR (2025 COLLECTION)
In the first year of the tax, a total of 6,781 properties were set to be billed for the tax since 372 properties were declared vacant and 6,409 were deemed vacant due to non-response by the declaration deadline.
Since the declaration deadline, the city has received 3,611 appeals and could still receive more, with the Late Appeal Deadline open until Dec. 31, 2026.
Currently, 3,170 properties remain subject to the tax – 372 declared vacant and 2,798 deemed vacant.
That brings the total revenues expected from the first year of the tax to $10.86 million – $1.09 million (10 per cent) from properties declared vacant and $9.77 million (90 per cent) from properties that were deemed vacant due to non-response.
Staff previously forecasted that there would only be 1,135 vacant properties across the city and that $4.32 million in revenue would be generated.
Projected net revenue for the first year is currently at $7.94 million, since operating and capital expenses for the program were $2.92 million.
The city has already successfully collected $6.23 million.
YEAR 2 – 2025 VACANCY YEAR (2026 COLLECTION)
In the second year of the tax, 306 properties were declared vacant and 4,087 were deemed vacant due to non-response.
The city has received 493 appeals and could still receive more, with the appeal period open until Oct. 7, 2026, and the late appeal period open from Jan. 1 to Dec. 31, 2027.
Currently, 3,900 properties remain subjected to the tax – 306 declared vacant and 3,594 deemed vacant due to non-response.
Staff are forecasting $9.14 million in net proceeds but have not revealed projected total revenue numbers or 2026 operating costs.
VOTING RESULTS: To continue collecting the Vacant Unit Tax in 2027. (PASSED 8-6)
IN FAVOUR (8): Maureen Wilson (Ward 1 – Chedoke-Cootes-Westdale), Cameron Kroetsch (Ward 2 – Downtown Hamilton), Nrinder Nann (Ward 3 – East Hamilton Centre), Tammy Hwang (Ward 4 – Hamilton East), Mark Tadeson (Ward 11 – Glanbrook-Binbrook-Mount Hope), Craig Cassar (Ward 12 – Ancaster-West Flamborough), Alex Wilson (Ward 13 – Dundas-Central Flamborough), Ted McMeekin (Ward 15 – East Flamborough-Waterdown)
AGAINST (6): Matt Francis (Ward 5 – Hamilton East-Stoney Creek), Tom Jackson (Ward 6 – East Mountain), Rob Cooper (Ward 8 – West/Central Mountain), Brad Clark (Ward 9 – Upper Stoney Creek), Jeff Beattie (Ward 10 – Stoney Creek-Fruitland-Winona), Mike Spadafora (Ward 14 – West Mountain)
CONFLICT OF INTEREST (1): Mayor Andrea Horwath
ABSENT (1): Esther Pauls (Ward 7 – Central Mountain)
Based in Hamilton, he reaches hundreds of thousands of people monthly on Facebook, Instagram, TikTok, and Twitter. He has been published in The Hamilton Spectator, Stoney Creek News, and Bay Observer. He has also been a segment host with Cable 14 Hamilton. In 2017, he received the Chancellor Full Tuition Scholarship from the University of Ottawa (BA, 2022). He has also received the Governor General’s Academic Medal. He formerly worked in a non-partisan role on Parliament Hill in Ottawa.
