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No Equal Protection for Toronto Taxpayers
01/04/2004

A couple weeks ago, when the province adjusted Bill 140 to give the City of Toronto limited freedom to raise commercial property tax rates, I also wrote about the unfairness of the education tax rates that are charged by the province.

Even though the province uses a uniform system for doling out cash to school boards across the province, they have an arbitrarily higher rate of property tax for businesses in Toronto and a few other municipalities. For no reason at all, really, except that they like the extra $120-million that it brings in. (And note: this is a higher tax rate; current value assessment already ensures that the total tax amount is already very high in Toronto.)

At the end of that posting I asked:

I've often wondered -- isn't this a violation of our rights to equal protection under the law? What gives the province the right to arbitrarily charge different tax rates to its residents based simply on where in the province they live? Those municipal borders were created by the province to begin with, and we're all citizens of Ontario -- so why does Queen's Park discriminate?

No one replied, but I was still interested. So, I took it into my own hands to seek out an answer.

I wrote to Brian McAllister, a lawyer in Windsor, and asked him my question. I knew him from his days working at Legal Aid at the University of Windsor. He defended me when I tried fighting a traffic ticket, but he is more famous as the guy who won the case that made pot legal in Canada.

Anyway, here's his very interesting reply (which he warns me is worth no more than I paid for it):

This is an example of how the Supreme Court has really botched the equality "guarantee" in s. 15 of the Charter, which says:

15. (1) Every individual is equal before and under the law and has the right to the equal protection and equal benefit of the law without discrimination and, in particular, without discrimination based on race, national or ethnic origin, colour, religion, sex, age or mental or physical disability. [my emphasis added (BM)]

(2) Subsection (1) does not preclude any law, program or activity that has as its object the amelioration of conditions of disadvantaged individuals or groups including those that are disadvantaged because of race, national or ethnic origin, colour, religion, sex, age or mental or physical disability.

In the first real cases involving s. 15 the court, quite naturally, said that the enumerated grounds were not the only ones the section protected (a rather obvious conclusion given the plain reading of the whole section), and that it at least applied to grounds that were "analogous" to the enumerated ones. In that case, the court said that you couldn't discriminate against permanently resident non-citizens - citizenship being sufficiently analogous to the enumerated grounds. In other words, the court was expanding the coverage of s. 15, but (in my view) in a manner consistent with the intent of the section: "we realize that you didn't enumerate citizenship, but you meant to prohibit discrimination on things like citizenship - which is similar to things like race, creed, colour, etc".

Things went downhill from there in a long series of cases - the court has made a bigger mess of s. 15 than any other charter right (this isn't me talking - there is a general consensus among legal experts on this). They then got all tied up in the notion of analogous and enumerated grounds, to the exclusion of anything else. They said that since the enumerated grounds appeared to cover inherent personal characteristics which apply to discrete and insular groups that have historically been the subject of discrimination, then the intent must be to protect against only that kind of discrimination. So what started out as a basis for expanding equality protection turned into a basis for restricting it. In other words, if you can't fit yourself within one of the enumerated or analogous grounds, then you are s.o.l. Oh yeah, and when determining what is an analogous ground, it must be a group that is discrete and insular and which has been historically disadvantaged. The court has instituted more multi pronged tests in the jurisprudence on this issue than on any else. The effect is that they've long since stopped looking at the actual wording of s. 15, and instead look at the case law, and have incrementally built more and more tests that result in more and more complication.

The fact is, the original point was to provide equal protection and benefit of the law - but making especially sure that those within the enumerated grounds get protection - this is important because of the application of part 2 of s. 15 (this was instituted to prevent against the American experience, where affirmative action type programs were challenged as "reverse discrimination" (as much as I dispute the term); part 2 essentially makes it legal to do it. That's where the idea of "historically disadvantaged" comes in. But I don't think the point of the equality guarantee was for only the historically disadvantaged groups to get it (which leads to bizarre results as people try to pigeon-hole themselves into the analogous grounds), but all of us.

This has led to silly and arbitrary results. To take the pot case as just one example - if you lived in Alberta and got popped for weed, you went down - hard. But there was no law in Ontario (there's a lot more to it than this, but I'll leave it at this for simplicity's sake). This is so even though pot is a federal, not a provincial statute, and prosecuted by the federal, not provincial Crown. This is a pretty explicit example of two people being similarly situated, but not being "equal" under or before the law - totally arbitrary, subject to where you live. You would think that this is exactly the kind of thing an equality right should address - but because of the way the jurisprudence has emerged - it doesn't. According to the court, "pot smokers" are not an enumerated or analogous ground; they aren't a historically disadvantaged group (whose disadvantage is based on immutable characteristics), so they get no protection.

Another example is your own. As absurd as the idea is, the province could charge you and I different tax rates based on our name, and we couldn't get recourse under s. 15. [I had asked "Certainly the province couldn't charge different rates of tax to people named Andrew than it does to people named Brian, so why should it be able to tax its citizens differently based on their address?" -- AS]

All of this long explanation to arrive at the short answer to your question: yes, the government can charge Torontonians different tax rates.

I certainly agree that it is idiotic, and an unfair legacy from the Tories "us vs. them" ruling stratagem, where they rather unabashedly rewarded their 905 constituency at the expense of the ungrateful (electorally, at least) 416 region. It is especially galling given the "conservative" ideology in favour of local governance. Toronto had long had higher business tax rates than the rest of the province, but that was a local political decision that resulted in considerably better funding for Toronto schools - iow, the municipality had made a political decision to spend more on schools, and to tax businesses more to pay for it. Then the Tories changed the education funding formula, and Toronto schools got totally hosed - with money previously going to TO schools flowing out to other parts of the province (especially 905). The real unfairness, of course, was that Toronto didn't get the corresponding benefit of lower taxes on business. So regions that had traditionally underfunded schools (but with the corresponding benefit of lower business taxes) got to suck money out of TO to make up the difference. Then, not only was Toronto subsidizing 905 schools (due to its own earlier historical political decision to tax more to pay for better schools), but its businesses were then getting hammered by 905 businesses that were taxed at a fraction. Talk about a double whammy. Very bad policy soley driven by politics.

Which is too bad as far as I'm concerned. I thought it would be a lot of fun to take this to court, especially the billion-dollar class action law suit. Darn.

Instead, though, we'll have to settle for continuing to remind Queen's Park that this isn't right, and has to stop.


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