Richmond Hill cannot simply adopt a land value tax on its own. But as plazas, parking lots and transit corridors sit on increasingly valuable land, the idea forces a useful local question: why do we tax improvement more than underuse?
By City Desk
Richmond Hill has a familiar problem: the city keeps getting more expensive to live in, more expensive to service, and more difficult to change. We debate tall towers, traffic, development charges, property taxes, transit, parking and infrastructure as if they are separate problems. But under many of these debates sits one quieter question: what do we reward landowners for doing with valuable land?
Yonge and Bernard is a useful local example. Richmond Hill’s own planning vision treats the area as a future mixed-use, transit-supportive centre, not just a collection of plazas and parking lots. That makes it a good place to ask the land value tax question: when public planning and infrastructure make land more valuable, should the tax system reward holding that land lightly used, or reward putting it to productive use?
| Local Case: Yonge and Bernard Shows the Question Yonge and Bernard is one of the best local places to understand why land value tax is relevant to Richmond Hill, even if the city cannot adopt it on its own. This is not a random suburban intersection. Richmond Hill’s own planning documents identify the Yonge and Bernard area as a place meant to evolve from a mostly retail and commercial node into a more mixed-use, connected urban centre. The plan imagines more residents, more jobs, better walking and cycling connections, and stronger support for transit. That means the value of land in this area is not created by the private owner alone. It is shaped by public decisions and public investment: Yonge Street, nearby transit, water and wastewater systems, parks, schools, sidewalks, zoning changes, planning permissions and the surrounding community. But if valuable land in a planned centre remains mostly low-rise, parking-heavy or underused for years, the public is left with an uncomfortable question. The city has already made the area more valuable through infrastructure and planning. Yet the tax system does not strongly distinguish between land that is being used productively and land that is simply being held for a future redevelopment opportunity. A land value tax would not magically build homes at Yonge and Bernard. It would not solve construction costs, approvals, zoning, parking rules or affordability. But it would change the incentive. The owner of valuable land would pay more because of the value of the land itself, not because they improved it. That makes it less attractive to sit on prime serviced land and more attractive to use it well. For Richmond Hill, Yonge and Bernard is a useful test case. If the city says this area should become more walkable, mixed-use and transit-supportive, then our tax and land-use rules should reward that outcome. They should not make it easier to hold valuable corridor land in a low-productivity form while residents pay more for infrastructure, services and housing scarcity. |
That is not just a planning detail. It is a financial question. If land near major roads, transit routes, pipes, parks, schools and public services remains mostly low-rise, parking-heavy or underused for years, who benefits from the rising land value? And who pays to maintain the public systems that make that land valuable in the first place?
This is where land value tax enters the conversation. A normal property tax generally taxes the assessed value of land plus the buildings or improvements on it. A land value tax shifts more of the tax burden onto the land itself and less onto what people build on top of it. In simple terms, the owner of a valuable site pays because the land is valuable, not because they added homes, shops, offices or other productive uses.
A normal property tax generally taxes the assessed value of land plus the buildings or improvements on it. A land value tax shifts more of the tax burden onto the land itself and less onto what people build on top of it.
That distinction matters. Under the regular property tax system, improving a property can increase its assessed value and therefore its tax bill. Under a land value tax, the tax system is less likely to punish the act of building something useful. Strong Towns has often made this argument: property tax can reward decline or underuse because the owner of an unimproved site avoids some of the tax increase that would come with improving it, while a land tax creates a stronger incentive to put valuable land to productive use.
For Richmond Hill, this is not an abstract idea. It goes directly to the question of whether the city is getting enough public value out of land that has already been served by expensive public infrastructure. A surface parking lot beside a major corridor, an aging plaza surrounded by asphalt, or a vacant parcel waiting for the “right” redevelopment moment may be privately owned. But its value is shaped by public decisions: roads, water and wastewater systems, transit planning, zoning, nearby parks, public safety, schools and the surrounding community.
Land value tax asks a blunt question: if the public helps create location value, should the tax system allow that value to sit mostly idle?
The idea is not new in Canada. Vancouver had a form of land value tax from 1910 to 1984, according to a City of Vancouver land value capture report. That same report also notes that returning to a recurring land value tax would require provincial legislative changes and changes to assessment practice, especially if land were taxed differently from buildings.
That history is important because it shows land value tax is not just a think-tank fantasy. Canadian cities have tried versions of it before. But the Vancouver example also warns us not to treat it as a magic switch. Land value tax depends on provincial rules, accurate assessments, careful transition design and political willingness. It is a serious municipal finance tool, not a slogan.
Ontario has not adopted a true land value tax for municipalities like Richmond Hill. In fact, Richmond Hill could not simply decide tomorrow to replace the existing property tax system with a full land value tax. MPAC, not the City, determines property value assessments and classifications for properties in Ontario. Richmond Hill’s own website states that the City does not determine property value assessments.
There is an even bigger complication: Ontario’s property assessment system is badly out of date. Richmond Hill says property assessments for the 2021, 2022, 2023, 2024, 2025 and 2026 taxation years continue to be based on the fully phased-in January 1, 2016 current values because the provincial reassessment update was postponed.
That means Richmond Hill is already trying to make 2026 tax decisions using a system anchored in 2016 values. Before Ontario could have a serious land value tax conversation, it would first need a credible, current and transparent assessment system. A land value tax depends on knowing what the land is worth separately from the building. If the underlying assessment system is stale, the reform becomes harder to explain and harder to defend.
Still, Ontario has begun moving in a related direction through narrower taxes on vacancy. Toronto’s Vacant Home Tax is designed to encourage owners of vacant residential properties to sell or rent them, with revenue allocated to affordable housing initiatives. Hamilton’s Vacant Unit Tax charges 1% of a property’s MPAC-assessed value when a residential unit is vacant under the City’s rules.
These are not land value taxes. They do not tax land separately from buildings. They apply only to certain vacant residential units, not to underused commercial plazas, empty lots or parking-heavy corridor properties. But they accept a related principle: in a housing shortage, the tax system does not have to stay neutral when valuable property is kept idle.
That principle is relevant to Richmond Hill. The city has many places where public policy says “urban centre,” “mixed use,” “transit-oriented,” or “more housing choice,” while the physical reality remains suburban, parking-heavy and financially underproductive. The land may be valuable because of location and public investment, but the public does not necessarily receive enough return to maintain the roads, pipes, parks and services that support it.
A land value tax could, in theory, help with that mismatch. It could make speculation less attractive by increasing the carrying cost of valuable underused land. It could reduce the tax penalty for improving a site with more homes, small commercial spaces, or mixed-use buildings. It could put pressure on surface parking lots and vacant parcels to become more productive. It could also help cities think more clearly about the relationship between land value, public investment and long-term infrastructure obligations.
But this is where the Strong Towns caveat matters. Chuck Marohn, the founder of Strong Towns, is not anti-land value tax. In a 2026 Strong Towns podcast, he called it “the best of all the bad taxes” and said Strong Towns is supportive of it. But he also said other groups are better positioned to lead on it and described it as more of a statewide policy issue than the central focus of the Strong Towns movement.
That caution should shape how Richmond Hill talks about the idea. Land value tax may be good policy, but it is not the whole Strong Towns answer. The deeper Strong Towns question is whether the city understands which places create enough wealth to maintain the infrastructure they require. A better tax system can improve incentives, but it cannot replace local accounting, honest infrastructure math, zoning reform, parking reform or better land-use decisions.
There are at least five caveats Richmond Hill should keep in mind.
First, land value tax is not something Richmond Hill can adopt alone under Ontario’s current property tax framework. Any serious version would require provincial action, MPAC assessment changes and probably a long transition period.
Second, land value tax does not automatically create affordability. If zoning still blocks gentle density, if construction costs remain high, if development charges are poorly designed, or if approvals remain slow and uncertain, changing the tax structure alone will not produce the homes Richmond Hill needs.
Third, land value tax is most useful where public investment has created high land value. That makes it relevant to corridors, centres and serviced suburban land. It is less useful as a blanket explanation for every part of a municipality. In Richmond Hill, the strongest local discussion would likely focus on places such as Yonge Street, Richmond Hill Centre, Yonge and Bernard, major plazas, GO station areas and other locations where public plans already call for more productive use.
Fourth, land value tax can create winners and losers. Owners of high-value, underused land may pay more. Owners of improved properties may pay less than they otherwise would. That may be the point, but it still requires careful transition rules, exemptions or phase-ins to avoid unfair shocks, especially for small property owners who are land-rich but cash-poor.
Fifth, land value tax does not fix bad city-building. A municipality can still approve expensive infrastructure, overbuild roads, mandate too much parking, separate uses, block small-scale infill, or approve tower clusters without walkable neighbourhoods. A better tax system can reward productive land use, but it cannot substitute for building places that actually work.
That may be the most useful lesson for Richmond Hill. The city does not need to wait for Queen’s Park to rewrite property taxation before asking better questions. Every corridor plan, development application, parking requirement and infrastructure project can be tested against the same principle: are we rewarding productive places, or are we rewarding land-holding?
A land value tax would ask more from a valuable site that benefits from public investment, even if the owner leaves it mostly empty, low-rise or covered in parking. Richmond Hill cannot simply impose that system tomorrow. But the idea exposes the weakness of the system we already have.
Right now, a resident who renovates a home, adds legal housing, or improves a property can face a higher assessment. Meanwhile, a valuable site on a major corridor can remain underused while the surrounding public investment helps its land value rise. That is a strange message for a city that says it wants more housing, better transit, stronger local businesses and more fiscally productive growth.
Land value tax will not save Richmond Hill. But it asks the right local question: why should the public keep carrying the cost of valuable land that is not being used to its potential?
The answer may not be a full land value tax tomorrow. It may be a vacancy tax, better parking policy, more permissive zoning, development charge reform, more transparent infrastructure accounting, or a provincial conversation about how Ontario taxes land. But the starting point is the same.
Richmond Hill should stop asking only how much tax people pay. It should also ask what kind of city our tax system rewards.