Windsor approves vacant home tax to combat empty properties

The city of Windsor will soon implement a vacant home taxafter the proposal received the council stamp of approval Monday night.

The tax will apply at a rate of three per cent onvacant homes, designed as an incentive to make homeowners either sell unoccupied homes or rent them to help combat the city's housing shortage.

According to a city-run public consultation earlier this year, almost 75 per cent of residents who responded to the survey supported a vacant home tax.

Municipalities were given the power to implement a vacant home tax in 2017. Toronto, Hamilton and Ottawa already have similar taxes, and council first requested information on the idea in 2021.

The tax will be determined based on the Municipal Property Assessment Corporationproperty value, and the city will hire two new full-time staff to administer the program.

According to staff, a home will be declared vacant if it is unoccupied for more than 183 days in a taxation year.

But exceptions apply in a variety of cases, like principle residences, homes that are vacant while under construction, homes that are vacant or up to two years after the owner enters care (like long-term care) or the death of the owner.

But, the city says, the tax isn't intended to be a revenue generator.

"It should be noted that if the program works as planned, the amount of VHT collected annually will likely decrease and could result in an annual operating deficit after offsetting administrative costs of the program," staff wrote in a report. "The intention of a VHT program is not to be a revenue generator."

The city conducted public consultation on the issues earlier this year. Pending provincial approval and the writing of the bylaw, the vacant home tax could be in place by February.

Council approved the recommendations, with the addition of having staff report back to council in one year on the effectiveness of the tax.

Council also approved increasing the penalty for false reporting that a home was occupied to $3,500 from the $2,500 recommendedby staff, and staff will also explore the possibility of tiered penalties for repeat offenders.

An appeals process will be available.