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O. Reg. 450/03: Tax Matters - Special Tax Rates and Limits, 2003 and Later Years

filed December 22, 2003 under Municipal Act, 2001, S.O. 2001, c. 25

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ontario regulation 450/03

made under the

municipal Act, 2001

Made: December 19, 2003
Filed: December 22, 2003
Printed in The Ontario Gazette: January 10, 2004

Amending O. Reg. 73/03

(Tax Matters — Special Tax Rates and Limits, 2003 and Later Years)

1. Paragraphs 1 and 2 of subsection 7 (3) of Ontario Regulation 73/03 are revoked and the following substituted:

1. Determine the sum of the general levies for all property classes levied for upper-tier purposes for the previous year under section 311 of the Act or, if the previous year is 2002, under section 366 of the Old Act.

2. Determine the sum of the general levies for all property classes levied for lower-tier purposes for the previous year under section 312 of the Act or, if the previous year is 2002, under section 368 of the Old Act.

2. Subsection 22 (2) of the Regulation is revoked and the following substituted:

(2) Subject to subsection (3), the following properties are deemed to be eligible property for the purposes of section 331 of the Act:

1. A vacant parcel of land that is severed from a larger parcel of land or that is a lot in a subdivided parcel of land, if the taxation year is the first year for which the parcel is included as a separate parcel on the assessment roll.

2. Despite subsection 329 (10) of the Act, property to which section 447.70 of the Old Act or section 331 of the Act applied in the previous year as a result of an assessment made under subsection 34 (2) of the Assessment Act or a severance or subdivision, if clause 329 (7) (a) of the Act applies to the property for the taxation year.

3. Property in respect of which an assessment could have been made under section 34 of the Assessment Act in the previous year if,

i. making the assessment in the previous year would have resulted in the application to the property of clause 447.65 (8) (a) of the Old Act or clause 329 (7) (a) of the Act, and

ii. the appropriate change is made on the assessment roll for the taxation year.

(3) None of the following is eligible property for the purposes of section 331 of the Act:

1. Property that would otherwise be eligible property only because of a change in classification from one class in the commercial classes to another class in the commercial classes or from one class in the industrial classes to another class in the industrial classes.

2. A severed parcel that is described in subsection 26 (2), (3) or (4).

3. A severed parcel that fails to satisfy the minimum size requirements for development under the relevant municipal zoning by-law.

(4) In this section,

“commercial classes” means the commercial classes as defined in subsection 308 (1) of the Act;

“industrial classes” means the industrial classes as defined in subsection 308 (1) of the Act.

3. The Regulation is amended by adding the following Part:

part vi
tax capping on consolidation or division of parcels

Application and interpretation

24. (1) In this Part,

“assessment roll” means the assessment roll under the Assessment Act;

“average level of taxation” means, in respect of two or more parcels of land for the previous year, the sum of the taxes for municipal and school purposes imposed on each parcel in the previous year divided by the sum of the taxes that would have been imposed for the previous year on each parcel if Part IX of the Act had not applied;

“consolidated parcel” means a parcel of land included on the assessment roll for the taxation year that was included on the assessment roll for the previous year as two or more separate parcels;

“level of taxation” means, in respect of a parcel of land for a year, the level of taxation for the parcel for the year that would be determined under paragraph 1 of subsection 331 (2) of the Act;

“original parcel” means, in respect of a taxation year, a parcel of land included on the assessment roll for the previous year that is severed or subdivided into two or more parcels of land that are included on the assessment roll for the current taxation year;

“property class” means a property class under the Assessment Act;

“separate parcel” means, in respect of a taxation year, a parcel of land included on the assessment roll for the previous year that is included on the assessment roll for the taxation year as part of a consolidated parcel;

“severed parcel” means, in respect of a taxation year, a parcel of land included on the assessment roll for the taxation year that was part of an original parcel included on the assessment roll for the previous year;

“subclass” means subclass of real property as defined in section 1 of the Assessment Act.

(2) For the purposes of this Part, the commercial classes, as defined in subsection 308 (1) of the Act, shall be deemed to be a single property class and the industrial classes, as defined in that subsection, shall be deemed to be a single property class.

(3) In this Part, a reference to a provision of the Act listed in Column 1 of the following Table shall be read as a reference to the provision of the Old Act listed in the same row in Column 2 of the Table if the reference is to the application of the provision for the 2002 taxation year:

Table

 

Column 1 — Act

Column 2 — Old Act

Part IX

Part XXII.3

Section 329

section 447.68

Section 330

section 447.69

Section 331

section 447.70

paragraph 1 of subsection 331 (2)

paragraph 1 of subsection 447.70 (2)

Consolidation of parcels, par. 1 of subs. 329 (2) of the Act

25. (1) This section applies to determine, for the purposes of paragraph 1 of subsection 329 (2) of the Act, the amount of taxes for the previous year if two or more parcels of land that were included on the assessment roll for taxation in the previous year are consolidated into one consolidated parcel on the assessment roll for the taxation year.

(2) The amount of the taxes for the previous year for the consolidated parcel is the sum of the taxes for municipal and school purposes levied on the separate parcels for the previous year if the property class in which each separate parcel was included for the previous year and the property class in which the consolidated parcel is included for the taxation year are the same.

(3) Subject to subsection (4), if two or more separate parcels were included in different property classes in the previous year to which Part IX of the Act applied and portions of the consolidated parcel are in the same property classes in the taxation year as the separate parcels, the amount of taxes for the previous year for the portion of the consolidated parcel that is in the same property class for the taxation year as the corresponding separate parcel in the previous year is the amount of taxes for municipal and school purposes levied for the previous year on the separate parcel.

(4) If any of the separate parcels was included in the subclass for vacant land for the previous year and the corresponding portion of the consolidated parcel is included for the taxation year in the subclass for excess land,

(a) the amount of the taxes for the previous year for the portion of the consolidated parcel that is included in the subclass for excess land in the taxation year is the amount of the taxes for municipal and school purposes that was levied on the separate parcel included in the subclass for vacant land for the previous year; and

(b) the amount of the taxes for the previous year for each portion of the consolidated parcel that is not included in the subclass for excess land in the taxation year is the amount of the taxes for municipal and school purposes that was levied for the previous year on the corresponding separate parcel if it was included in the same property class in the previous year as the portion of the consolidated parcel.

(5) If two or more of the separate parcels were included in the same property class to which Part IX of the Act applied in the previous year but only a portion of the consolidated parcel is included in that property class in the taxation year, the amount of the taxes for the previous year for that portion of the consolidated parcel is the amount determined in the following manner:

1. Determine the average level of taxation of the separate parcels for the previous year.

2. Determine the tax rate levied by the municipality for the previous year on property in the same property class as that portion of the consolidated parcel.

3. Determine the assessment on the portion for the taxation year.

4. Determine the total assessment of the consolidated parcel.

5. Divide the amount determined under paragraph 3 by the amount determined under paragraph 4.

6. Determine the total assessment of the separate parcels for the previous year.

7. Multiply the quotient determined under paragraph 5 by the amount determined under paragraph 6.

8. Multiply the average level of taxation determined under paragraph 1 for the previous year by the tax rate determined under paragraph 2 for the previous year.

9. Multiply the product determined under paragraph 7 by the product determined under paragraph 8.

(6) If two or more of the separate parcels were included in different property classes to which Part IX of the Act applied in the previous year and the consolidated parcel is included in the same property class for the taxation year as one of those separate parcels, the amount of the taxes for municipal and school purposes for the consolidated parcel for the previous year is the amount determined in the following manner:

1. Determine,

i. the level of taxation for the previous year of the separate parcel that was included in the same property class in the previous year as the consolidated parcel, if only one separate parcel was in the same property class for the previous year as the consolidated parcel, or

ii. the average level of taxation for the previous year of the separate parcels that were included in the same property class in the previous year as the consolidated parcel, if more than one separate parcel was in the same property class for the previous year as the consolidated parcel.

2. Determine the sum of the assessments for the previous year of all of the separate parcels that were in different property classes for the previous year than the consolidated parcel.

3. Determine the tax rate levied by the municipality for the previous year on property in the same property class as the consolidated parcel.

4. Multiply the sum of the assessments determined under paragraph 2 by the tax rate referred to in paragraph 3.

5. Multiply the product determined under paragraph 4 by the lesser of,

i. 1.00, and

ii. the level of taxation or average level of taxation for the previous year determined under paragraph 1.

6. Add the product determined under paragraph 5 to the taxes determined for the previous year under section 329, 330 or 331 of the Act for all of the separate parcels that were included in the same property class in the previous year as the consolidated parcel.

(7) The amount of taxes for municipal and school purposes of the consolidated parcel for the previous year is the amount determined under subsection (8) if,

(a) two or more of the separate parcels that were consolidated for the taxation year were included in different property classes for the previous year;

(b) not all of the separate parcels that were consolidated were included in property classes that were subject to Part IX of the Act for the previous year;

(c) the consolidated parcel is included in a single property class that is subject to Part IX of the Act for the taxation year; and

(d) the property class in which the consolidated parcel is included for the taxation year is the same as the property class in which one of the separate parcels was included in the previous year.

(8) For the purposes of subsection (7), the amount is determined as follows:

1. Determine,

i. the level of taxation for the previous year of the separate parcel that was included in the same property class in the previous year as the consolidated parcel, if only one separate parcel was in the same property class for the previous year as the consolidated parcel, or

ii. the average level of taxation for the previous year of the separate parcels that were included in the same property class in the previous year as the consolidated parcel, if more than one separate parcel was in the same property class for the previous year as the consolidated parcel.

2. Determine the sum of the assessments for the previous year of all separate parcels that were included in property classes that were not subject to Part IX of the Act.

3. Determine the tax rate levied by the municipality for the previous year on property in the same property class as the consolidated parcel.

4. Multiply the sum of the assessments determined under paragraph 2 by the tax rate referred to in paragraph 3.

5. Multiply the product determined under paragraph 4 by the lesser of,

i. 1.00, and

ii. the level of taxation or average level of taxation for the previous year determined under paragraph 1.

6. Add the product determined under paragraph 5 to the taxes determined for the previous year under section 329, 330 or 331 of the Act for all of the separate parcels that were in the same property class in the previous year as the consolidated parcel.

Severance or subdivision of land, par. 1 of subs. 329 (2) of the Act

26. (1) This section applies in determining the amount of taxes for the previous year for a severed parcel for the purposes of paragraph 1 of subsection 329 (2) of the Act.

(2) The amount of the taxes for municipal and school purposes for the previous year for a severed parcel that is in the same property class in the taxation year as the property class in which the original parcel was included for the previous year is the amount determined in the following manner, if the original parcel was not included in the previous year in the subclass for vacant land:

1. Determine the taxes for municipal and school purposes for the original parcel for the previous year under section 329, 330 or 331 of the Act.

2. Determine the ratio of the assessment for the taxation year of each severed parcel that is in the same class as the original parcel to the total assessment of the severed parcels for the taxation year.

3. Multiply the amount of taxes determined under paragraph 1 by the ratio determined under paragraph 2.

(3) If a portion of the original parcel was included in the subclass for excess land for the previous year, the taxes for municipal and school purposes for the previous year for a severed parcel that is not in the subclass for vacant land for the taxation year and that is in the same property class as the corresponding portion of the original parcel that was not included in the subclass for excess land for the previous year is the amount of taxes levied on the corresponding portion of the original parcel in the previous year.

(4) If the original parcel contains portions that are in different property classes to which Part IX of the Act applied and the severed parcels are contained in the same property class as a portion of the original parcel, the taxes for municipal and school taxes for the previous year for the severed parcel is the amount of the taxes levied on the corresponding portion of the original parcel.

Portion of parcel in same property class as original parcel

27. (1) The section applies to a portion of a parcel of land if,

(a) the parcel of land was in a single property class that was subject to Part IX of the Act in the previous year; and

(b) the parcel of land is apportioned into more than one property class for the taxation year and the portion of the parcel is in the same class as the classification of the parcel from the previous taxation year.

(2) The taxes for the previous year for the portion of the parcel of land shall be determined in the following manner:

1.   Determine the taxes for the original parcel for the previous year under section 329, 330 or 331 of the Act.

2.   Determine the ratio of the assessment of the apportioned parcel that is in the same property class as the original parcel for the taxation year to the total assessment of the parcel for the taxation year.

3.   Multiply the amount of taxes determined under paragraph 1 by the ratio determined under paragraph 2.

Change in proportions of parcel in different property classes

28. (1) This section applies to a parcel that satisfies the following conditions:

1. Portions of the parcel were included in different property classes for the previous year.

2. Portions of the parcel are included in the same property classes for the taxation year and not in any other property class.

3. The proportion of the assessment of each portion of the parcel in a property class has changed between the previous year and the taxation year.

4. The change in the assessment for each portion of the parcel included in a property class for the taxation year is due only to a change in the proportion of the parcel included in each of the property classes, as a result of a change event described in clause (a) of the definition of “change event” in subsection 34 (2.2) of the Assessment Act.

(2) The amount of taxes for municipal and school purposes for the previous year for the purposes of paragraph 1 of subsection 329 (2) of the Act for each portion of the parcel whose assessment increased between the previous year and the taxation year is determined as follows:

1. Determine the amount of taxes that were levied on the portion of the property for the previous year under section 329, 330 or 331 of the Act.

2. Determine the amount of taxes that would have been levied on the portion of the property for the previous year but for the application of Part IX of the Act.

3. Divide the amount determined under paragraph 1 by the amount determined under paragraph 2.

4. Determine the assessment of the portion of the property on the assessment roll for the taxation year.

5. Determine the total assessment of the property on the assessment roll for the taxation year.

6. Divide the amount determined under paragraph 4 by the amount determined under paragraph 5.

7. Multiply the quotient determined under paragraph 6 by the total assessment of the property on the assessment roll for the previous year.

8. Determine the amount of taxes that would have been levied in the previous year on the assessment amount determined under paragraph 7 but for the application of Part IX of the Act.

9. Subtract the amount determined under paragraph 2 from the amount determined under paragraph 8.

10. Multiply the remainder determined under paragraph 9 by the lesser of,

i. the quotient determined under paragraph 3, and

ii. 1.0.

11. Add the product determined under paragraph 10 to the amount determined under paragraph 1.

(3) The taxes for municipal and school purposes for the previous year for the purposes of paragraph 1 of subsection 329 (2) of the Act for each portion of the parcel whose assessment decreased between the previous year and the taxation year is determined as follows:

1. Determine the assessment of the portion of the property on the assessment roll for the taxation year.

2. Determine the total assessment of the property on the assessment roll for the taxation year.

3. Divide the amount determined under paragraph 1 by the amount determined under paragraph 2.

4. Multiply the quotient determined under paragraph 3 by the total assessment of the property on the assessment roll for the previous year.

5. Determine under section 329, 330 or 331 of the Act the amount of taxes that would have been levied for the previous year on the assessment amount determined under paragraph 4.

Change in tax exempt portion of a parcel

29. (1) This section applies if the portion of a parcel of land that is exempt from taxes for municipal and school purposes changes between the previous year and the taxation year and the change is due only to a change in the proportion of the parcel that is entitled to the exemption.

(2) The amount of taxes for municipal and school purposes for the previous year for the taxable portion of the parcel for the purposes of paragraph 1 of subsection 329 (2) of the Act is determined as follows:

1. If the assessment of the taxable portion of the parcel increased between the previous year and the taxation year, the amount of the taxes for municipal and school purposes for the previous year for that portion is the amount that would be determined in respect of the portion of the parcel under subsection 28 (2).

2. If the assessment of the taxable portion of the parcel decreased between the previous year and the taxation year, the amount of the taxes for municipal and school purposes for the previous year for that portion is the amount that would be determined in respect of the portion of the parcel under subsection 28 (3).

Change in subclass assessment of a property

30. (1) This section applies if,

(a) the proportion of the assessment on the portion of a property that is in a subclass for excess land, if any, changes between the previous year and the taxation year; and

(b) the change in the assessment referred to in clause (a) results from the application of municipal requirements for any development on the property.

(2) The amount of taxes for the previous year for the purposes of paragraph 1 of subsection 329 (2) of the Act for the portion of the property that is not in a subclass for excess land is determined as follows:

1. Determine the assessment of the portion of the property that is not in a subclass for excess land for the taxation year.

2. Determine the total assessment of the property for the taxation year.

3. Determine the total assessment of the property for the previous year.

4.   Determine the tax rate levied by the municipality for the previous year on the portion of the property not in a subclass for excess land.

5.   Determine the level of taxation for the previous year for the property.

6.   Divide the amount determined under paragraph 1 by the amount determined under paragraph 2.

7.   Multiply together the following:

i. the quotient determined under paragraph 6,

ii. the amount determined under paragraph 3,

iii. the tax rate determined under paragraph 4, and

iv. the level of taxation determined under paragraph 5.

(3) The amount of taxes for the previous year for the purposes of paragraph 1 of subsection 329 (2) of the Act for the portion of the property that is in a subclass for excess land is determined as follows:

1.   Determine the assessment of the portion of the property that is in a subclass for excess land for the taxation year.

2.   Determine the total assessment of the property for the taxation year.

3.   Determine the total assessment of the property for the previous year.

4.   Determine the applicable tax rate in the municipality for the previous year for the subclass for excess land.

5.   Determine the level of taxation for the previous year on the property.

6.   Divide the amount determined under paragraph 1 by the amount determined under paragraph 2.

7.   Multiply together the following:

i. the quotient determined under paragraph 6,

ii. the amount determined under paragraph 3,

iii. the tax rate determined under paragraph 4, and

iv. the level of taxation determined under paragraph 5.

Mid-year demolition, etc.

31. (1) For the purposes of clause 357 (1) (b) of the Act, the recalculation of taxes for the taxation year shall include a reduction determined as follows:

1. If paragraph 2 does not apply, the reduction is,

i. 30 per cent of the taxes otherwise determined for the current taxation year, if the property was included in the commercial classes, or

ii. 35 per cent of the taxes otherwise determined for the current taxation year, if the property was included in the industrial classes.

2. If a by-law was passed under subsection 313 (4) of the Act that sets out a percentage of taxes between 30 and 35 per cent, the reduction is that percentage of the taxes.

(2) Paragraph 5 of subsection 329 (2) of the Act applies to a property even if the owner of the property was entitled to but failed to make an application to the council of the municipality under clause 357 (1) (a), (b), (d) or (f) or section 358 of the Act for a cancellation, reduction or refund of taxes for the previous year, but only if the appropriate change is made to the assessment of the property on the assessment roll, as returned, for the taxation year.

Comparable property for purposes of s. 331 of the Act

32. If subsection 328 (2) of the Act applies for the taxation year to a property that is identified as a comparable property under section 331 of the Act, the amount of taxes for municipal and school purposes that would have been imposed for the taxation year on the comparable property but for the application of Part IX of the Act, as determined for the purposes of paragraph 1 of subsection 331 (2) of the Act, shall be increased to the taxes for municipal and school purposes that would have been imposed for the taxation year but for the application of subsection 328 (2) of the Act.

Made by:

Gregory Sorbara

Minister of Finance

Date made: December 19, 2003.