Councillor aims to axe Ottawa's vacant unit tax this week

An Ottawa city councillor is looking to axe the city's new vacant unit tax this week, suggesting the administration of the new levy is "an unparalleled annual bureaucratic burden" on households.

Council will vote Wednesday on a motion from Coun. Laura Dudas, seconded by Coun. George Darouze, calling for the city to rescind the tax in 2024 and not charge the owners of vacant properties the one per cent tax on their 2023 assessment.

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The previous Council approved the new vacant unit tax in March 2022, a move designed to address homes sitting empty and neglected. Under the program, property owners are required to submit an annual declaration indicating their home's occupancy status, even if it's their principal residence. Any property that's been empty for more than 184 days during the previous year will be taxed an extra one per cent, with that funding supporting affordable housing.

Staff said in June that 3,268 homes were declared vacant by homeowners and 2,836 were deemed vacant by the city because no declaration was received. More than 1,900 notices of complaint were filed about the tax, according to the city.

In her motion for Council, Dudas notes the 1.8 per cent vacancy rate reported by staff is "over triple staff's original projections", and higher than both Toronto and Vancouver. 

"Either Ottawa is Canada's most vacant city by orders of magnitude, or more realistically, the VUT is being improperly applied to Ottawa residents," Dudas said in her motion, noting the city anticipated a vacancy rate of 0.5 per cent.

In the first year of the vacant unit tax in Toronto, 2,100 units out of 336,865 units were declared vacant, while 2,193 of 186,000 units in Vancouver were vacant, according to the motion.

Dudas voted against the vacant unit tax when the city approved the plan in 2022.

"The VUT is the only tax or service administered by the city of Ottawa that subjects a yearly, reverse-onus requirement on all residential property owners," Dudas said in her motion.

"Councillors have heard from residents who were blindsided by having the VUT applied to them."

Only 69 of 16,758 units in Orleans West-Innes, represented by Dudas, were declared vacant by homeowners this year.

Rideau Vanier and Somerset had the highest vacancy rates in Ottawa at 2.3 per cent. There were 355 vacant units in Rideau-Vanier and 313 in Somerset.

With files from CTV News Ottawa's Ted Raymond