 Stuck in Place: The Effect of Land Transfer Taxes on Housing TransactionsC.D. Howe Institute Commentary, 2012, issue 364 Abstract: Numerous provinces and municipalities across Canada levy Land Transfer Taxes (LTTs). An LTT is a charge paid to a municipality or provincial government, upon the sale or transfer of real estate or similar immovable object. LTTs can be expensive, and make up a significant portion of the expenses associated with ordinary housing transactions, making moving more costly. The higher transaction costs, owing to the LTT, may cause some households to tolerate living in ill-suited homes for longer than they would have otherwise desired. Other potential effects of LTTs include government revenue volatility, commercial real estate market distortions, and higher construction costs. Municipalities that levy LTTs should limit themselves to other revenue-raising tools and replace the LTT with a revenue-equivalent property tax levy. Provincial governments that impose an LTT should replace their LTTs with revenue from value-added taxes. Keywords: Fiscal and Tax Competitiveness; Canadian provincial and municipal governments; Land Transfer Taxes (LTTs); real estate sale or transfer; household mobility (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:cdh:commen:364 Access Statistics for this article More articles in C.D. Howe Institute Commentary from C.D. Howe Institute Contact information at EDIRC. |
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