Raise the Hammer
A letter published in the Hamilton Spectator yesterday ("Why is it the out-of-towners take the biggest tax hit?", April 11) decries having to shoulder a higher percent tax increase "for rebuilding the roads, bridges, sewers and other crumbling infrastructure in the old City of Hamilton that the residents there couldn't otherwise afford."
The author calls it "discrimination" that Hamilton residents are seeing a 2.5 percent increase in property tax while Dundas residents are being hit with 4.9 percent and Flamborough residents face 4.8 percent.
This may be good politics but it's bad math, ignoring the effect a smaller base price has on a larger percent increase.
Using the City of Hamilton's property tax calculator, I calculated the 2004 taxes (excluding Police and Education, which are fixed across all areas) for a $200,000 residence in Hamilton, Dundas (with HSR), Dundas (without HSR), and Flamborough.
| Home Value | Area | Tax |
|---|---|---|
| $200,000 | Hamilton | $2,382 |
| Dundas (HSR) | $1,949 | |
| Dundas (no HSR) | $1,900 | |
| Flamborough | $1,632 |
Increasing the taxes by 2.5%, 4.9%, 4.9% and 4.8%, respectively yielded the following final taxes.
| Home Value | Area | 2004 Tax | % Increase | 2005 Tax |
|---|---|---|---|---|
| $200,000 | Hamilton | $2,382 | 2.5 | $2,442 |
| Dundas (HSR) | $1,949 | 4.9 | $2,045 | |
| Dundas (no HSR) | $1,900 | 4.9 | $1,993 | |
| Flamborough | $1,632 | 4.8 | $1,710 |
Despite a lower percent increase, Hamilton still pays the highest actual amount. The differing percentages this writer scorns are actually helping to make the regional property tax system less discriminatory.
Since the cost to deliver residential infrastructure is often higher in rural areas and lower densities mean less payers, city taxpayers still carry more than their share of the total tax burden.
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