The Vacant Unit Tax is also Good Environmental Policy

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On August 23, Ottawa City Council voted to maintain the city’s fledgling Vacant Unit Tax (VUT). 

According to the City’s website, this tax has the goal of encouraging “homeowners to maintain, occupy or rent their properties, thereby increasing the housing supply.” As such, the VUT can address the affordable housing crisis (a housing emergency declared by City Council in 2020) that Ottawa faces, by adding pressure on individuals to rent out their vacant homes. 

The vote was on a motion moved by Councillor Laura Dudas (Ward 2—Orléans West-Innes), calling on the City to rescind the tax in 2024. In addition to this, the motion recommended that owners of vacant properties should not be subject to the 1% tax on their 2023 assessment.

Emphatically, Council’s vote on the VUT has implications for the environment. An indirect effect that it will have is greater population density, which leads to services in our city being delivered more efficiently. This means improved transportation and water infrastructure, for example. 

Furthermore, vacant units can cause pollution-related liability, given that older buildings may have materials containing asbestos or the possibility of leaks. Vacant units are more likely to be poorly maintained, which in turn can lead to mold, exacerbated by weather-related instances and affected waste systems (and thus, waterways). It can be difficult to determine how owners find solutions to environmental hazards in their properties, especially if they are not held responsible for its maintenance nor its vacancy.

The VUT also represents a contribution to environmental policy, as it encourages us to rethink the way we use resources and, ultimately, space. 

I believe that an argument against the VUT could be that a tax is not the solution to affordable housing in Ottawa, but rather an updated zoning strategy for the City. After all, Ottawa is the most sprawling city in Canada.

To this, I suggest, why not both? 

The VUT discourages property owners from sitting on their units, while also highlighting the gaps in housing affordability and availability. Undoubtedly, the onus should not solely be placed on homeowners to remedy housing problems; it should equally be placed on our policymakers to make appropriate decisions targeting housing inequality. But, it remains a step in the right direction…

Yasmine Hadid is a student in Environmental Economics and Public Policy (in French) at the University of Ottawa. She has an interest in policy issues related to transportation, sustainability, and environmental management.


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