Report: Tax burden on New Ontario homes hits 36%

A report by the Residential Construction Council of Ontario (RESCON) has revealed that taxes now account for nearly 36% of the average price of a new home in Ontario, a sharp rise from 31% in 2021. On a typical $1.07 million home, buyers pay approximately $381,000 in taxes and fees, including development charges, income, corporate, sales, and transfer taxes.

“These taxes are out of control and pushing the cost of new housing beyond the reach of most working families,” said RESCON president Richard Lyall, citing challenges for developers and affordability.

The study by the Canadian Centre for Economic Analysis shows municipalities impose higher development charges to fund infrastructure, disproportionately affecting lower-income households. In some areas, tax burdens on homes priced at $450,000 exceed 45%.

RESCON urges federal and provincial governments to reform tax policies and increase funding for municipal infrastructure to alleviate housing costs.