The budget committee has voted in favour of a motion that reduces the proposed property tax hike by about one quarter of a percentage point.

City staff were recommending a two per cent property tax hike as part of the 2014 operating budget, but on Wednesday afternoon budget committee voted 4-2 in favour of a Michelle Berardinetti motion that trims the increase to 1.75 per cent.

When a 0.5 per cent levy to fund the extension of the Bloor-Danforth subway line is factored in, the total property tax hike in 2014 will be 2.25 per cent, provided council as a whole votes in favour of the proposed budget.

“The size of the cushion in terms of what was expected in funds from the land transfer tax and the actuals that were being recorded allowed us to do this (reduce the proposed hike) and I think if you have an opportunity to reduce the residential tax levy you should take advantage of it,” Deputy Mayor Norm Kelly said while speaking with reporters Wednesday. “I think this is a reasonable, balanced, win-win budget.”

Ford says tax hike is still too high

Mayor Rob Ford has called for no more than a 1.75 per cent property tax hike in the 2014 operating budget and on Wednesday he told reporters that he can “easily” come up with $50 million in savings to make that happen, calling it “simple stuff.”

“I am going to come up with at least $50 million and I am going to put it on the floor of council and we will have a full debate,” he promised.

Ford did not specify the nature of the savings he plans to propose but he did say that “services will not be cut,” a statement Coun. James Pasternak cast doubt upon in an interview with CP24.

“I have been on budget committee for two years and finding $50 million is extremely difficult if not impossible,” Pasternak said. “ When you go through the programs we are committed to and statutory requirements carving that kind of volume out in one fell swoop is next to impossible.”

Speaking with reporters at city hall, Kelly encouraged Ford to provide his list of savings, but reiterated that the proposed budget makes sense as currently constructed.

“It is not siding with me or siding with someone else it is about what budget makes sense and what budget is reasonable and balanced and addresses as many issues as there are out there,” he said. “At the end of the day I think residents of Toronto will be supportive of this budget because it is well rounded, it’s balanced and it addresses the issues that are before council both fiscally and socially.”

Land transfer tax will stay the same for now

During their meeting Wednesday, budget committee also considered a proposal to reduce the land transfer tax by five per cent but ultimately voted 4-1 against the plan.

The tax, which is levied on top of a provincial land transfer fee, netted $344 million in revenue for the city last year and reducing it by five per cent would have cost the city about $17 million in 2014.

The entire budget will be considered during the Jan. 22 meeting of executive committee. If approved by executive committee, it will then be considered by council as a whole on Jan. 29.

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