The City of Toronto is in a well-documented awful financial situation, and a couple dozen buildings in the city are making it even worse by not paying property taxes to the tune of some $37 million.
The City of Toronto has released a report that provides information on property tax accounts with outstanding receivables of $500,000 or more as of December 31, 2022. The report indicates that the total number of properties with outstanding receivable balances of $500,000 or more remains at 26, the same as the number reported as of December 31, 2021. Of these 26 properties, 23 are owned by corporations, while the remaining 3 are owned by individuals.
Properties include a rather nondescript business in an industrial park area near Jane and Finch at 99 Toryork Dr., which owes more than $5 million and a commercial building in Chinatown at 222 Spadina Ave., which includes four different property tax accounts and owes approximately $8 million combined.
The worst offender is a building that is home to a Royal Bank at 600 Queens Plate Dr. that owes more than $8 million.
Another delinquent account is 900 York Mills Rd., home to the swanky Pan Pacific Toronto hotel (formerly Westin Prince) and Japanese restaurant Katsura near the corner of Don Mills and York Mills, which owes more than $2 million. The site had a development proposal filed with the city in 2018.
According to a City of Toronto staff report, the City continues to monitor outstanding property tax receivables and take action. The largest debtor accounts remain a priority for collection action. As property taxes form a first priority lien on the property, the City’s tax receivables are secure with minimal risk of uncollectable taxes. The Revenue Services Division uses both internal collection procedures and bailiffs to collect unpaid property taxes. In addition, the City charges 15% interest per year on overdue taxes, and penalties are applied at a rate of 1.25% on the first day of default and at the beginning of every month thereafter.
“The City bills approximately $6.68 billion in property taxes for municipal and school purposes each year, of which approximately $4.59 billion is for municipal purposes,” reads the staff report. “Most property owners pay their taxes on time.”
The report indicates that there are 26 properties with a tax receivable balance of $500,000 or more, totalling approximately $39.9 million. Three properties are owned by individuals, with approximately $2.2 million in unpaid receivables, while the remaining 23 properties are owned by corporations, with approximately $37.7 million in outstanding receivables. Of the commercially owned properties, eight new properties have been added to the largest debtors list since the last report, while the remaining 15 properties have had substantial payments made to reduce the balance of outstanding receivables by $0.3 million.
But things are improving, the report shows that the number of properties with arrears greater than $500,000 and the value of associated unpaid taxes has improved dramatically since 2000.