The Executive Committee of the City of Toronto met today and voted unanimously to eliminate Toronto’s $60 Vehicle Registration Tax (VRT) on January 1, 2011. This decision should be confirmed when City Council meets on December 16, 2010 to vote on this motion.
The City of Toronto’s City Council voted in favour of implementing this new tax (VRT) on October 22, 2007 and it affected all motorists with a Toronto (which, since 1997, included Scarborough, North York, East York, York & Etobicoke) address:
Council approved the Personal Vehicle Tax at the following flat rates for each vehicle licence plate renewal:
- $60 per personal vehicle (passenger vehicles and light commercial vehicles for personal use) per year
- $30 per personal motorcycle (motorcycle and limited speed motorcycle) or moped per year
*Double these amounts when two-year licence plate validation renewals are purchased.
On April 28, 2008, Council adopted Executive Committee report EX 22.16, the “Personal Vehicle Tax- Administrative Design Features and Implementation Authorities”, and set the effective date for the tax at September 1, 2008.
The tax is designed to be compatible with the Provincial vehicle permitting system. The Province collects the PVT on the City’s behalf when payment is made for a licence plate renewal.
When the VRT is eliminated January 1, 2010, those drivers who had already paid for two (2) year plate renewals will receive a refund for the amount paid for next year. If your birthday fell in December, you will have to pay for the 2010 tax, even if you attempt to renew your plate sticket next year in January.
City Council voted to introduce this tax (under New Taxation Measures – City of Toronto Act, 2006) on every Torontonian in 2007 due to a shortage of revenue in the City coffers. It was implemented on September 1, 2008 and Torontonians have hated it ever since; some Torontonians even registered their address outside of Toronto to avoid having to pay the tax.
When this tax was implemented, the City believed that in the last four (4) months of 2008 (Sept. 1 – Dec. 31/08) it would generate approximately $20 million dollars. As it turned out, when the tax was implemented, motorists began contacting the Ministry of Transportation and began providing change of residential addresses for their driver’s licences, outside of Toronto, to avoid the $60.00 tax. Instead of collecting the $20 million dollars they expected, the City only collected $13.5 million dollars or $6.5 million dollars less than expected. This meant there were about 167,000 registered vehicle owners who had figured out a way not to pay.
The City estimates that the elimination of the VRT next year will cost the City about 64 million dollars. The Mayor has also made a commitment to freeze property taxes and by freezing the taxes and eliminating the VRT, the City will lose about $50 million dollars in annual revenue. The City may hike up the water rates by 9% and the garbage fees by 4% in 2011, but at least the VRT will no longer be an additional cost to Torontonians.
1. What is the City of Toronto Personal Vehicle Tax?
It’s a new tax introduced by the City of Toronto. The province of Ontario acts as an agent to collect the tax on behalf of the city. Toronto residents who own passenger vehicles, personal use light commercial vehicles, motorcycles, or mopeds are required to pay the tax upon renewal of their plate validation.
For more information visit the City of Toronto’s website.
Toronto City Council decided to implement another tax, this time on drivers. On top of all the other expenses Torontonians incur, they will now be expected to pay an extra $60 a year to register their cars.
Those that voted in favour: 25 Those that were opposed: 20
For more information, read the report presented to Toronto City Council
Meanwhile, City of Toronto residents who have a motor vehicle registered to an address within the City, must ensure they legally comply with the Ministry of Transportation vehicle plate/sticker licencing requirements.
Update: After four hours of debate on Thursday, December 16, 2010, City Councillors voted 39-6 to repeal the unpopular vehicle tax as of January 1, 2011.
The City of Toronto provides Questions and Answers to Torontonians about the effect of the repeal of the Personal Vehicle Tax (PVT) on December 16, 2010 that goes into effect on January 1, 2011.
What will change:
You can call 311 if you have any questions relating to the cancellation or refund of the Personal Vehicle Tax (PVT).
Update: December 19, 2010 – Car tax dings drivers with late-year birthdays