In September it was announced that Toronto’s Municipal Land Transfer Tax (MLTT) will shift in 2024 from a blanket capped tax rate of 2.5% on homes over $3,000,000 to an escalating tiered tax up to 7.5% tax on homes over $20,000,000.
The MLTT, on homes over $3,000,000 being dubbed the 'New Luxury Tax, is in addition to the Provincial Land Transfer Tax of 2.5% on homes over $2,000,000.
This astounding Toronto only tax hike has triggered a wave of prestigious properties coming to market and selling with quick closing dates prior to December 31, 2023.
For example, the MLTT on a $5,000,000 home tax will increase from $125,000 @ 2.5% to $275,000 @ 5.5% in 2024 ( See chart below) plus the additional Provincial Land Transfer tax of 2.5%. The total tax payable, cash on closing by the buyer, as of January 1st will now be $400,000.
On a $20,000,000 home, the tax has increased from $500,000 @ 2.5% to $1,500,000 @7.5% in addition to the Provincial tax for an astounding $1,750,000 transfer fee to the government.