An Interesting Tax Proposal

September 2nd, 2007 by Potato

Toronto is hurting for money lately, and is considering all kinds of new ways to raise taxes or other revenues. One interesting proposal just announced yesterday by the CBC is to increase property taxes for big box stores and gas stations for promoting a “car culture”. This is a neat idea along the lines of a green party proposal (tax that which you want to have less of). It also makes some sense since gas stations can have leaks and runoff that can damage the soil they’re sited on, or get into the sewer systems, and they’re likely not paying their full share for those cleanups. AFAIK, gas is sold on a fairly tight margin, so I don’t know if this will spell doom for the gas stations within driving distance to the 905 (unless the 905 plays along too). The big box stores probably won’t even notice unless this is a really substantial tax hike, since property taxes don’t (again, AFAIK) make up a very large portion of retail markup.

In the end, while I think this is just as valid a way of choosing which properties to increase taxes on as any other (perhaps even preferred), I don’t really think it’s going to impact the number of big box stores or gas stations within Toronto, or really change our car culture. While we could possibly go through another doubling of gas prices, it doesn’t look like the high price of operating a car is enough of a deterrent to stop people from driving. To do that we would have to make it much easier than it currently is to get around without a car. And that would require not just more bus routes with more frequent service (including routes to get around your neighbourhood — it’s not too hard for a lot of people to get on a bus to the subway or GO station to get downtown, but it’s pretty tough to take a bus to the grocery store and back locally), but also much improved intercity rail or bus connections. It takes Wayfare something like 4-5 hours to get from London to Markham, with service only every two hours or so, while I can drive there in 2 any time I want. With that kind of disparity in service/convenience it’s no surprise that anyone who travelled outside the city with any kind of regularity would need a car, and once it’s in the driveway…

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