For the past two years London has had some larger than normal tax increases because we’ve had to catch-up on more than a decade of taxes that were artifically kept low by previous Councils, leading to police understaffed by more than 100 officers, road and sewer repairs overdue, obsolete software & tools for staff to do their job efficiently, underfunded public housing falling into disrepair, and so on. Added to that, since COVID the cost of everything has gone up for cities just like it has for all of us at home or at your business. Big investments had to be made.

Having made those key investments in community safety and housing, the Mayor and Council insisted on getting this year’s tax increase back to a more reasonable level and the 2026 tax rate will start at 3.4%. (And as indicated by the green line, when the tax policy ratios are applied in May with the final 2025 year end numbers, the residential rate for homeowners will come in lower than that).

It is important to understand that property taxes will always go up. While capital projects can be debt financed and paid off like a mortgage over a number of years, municipal operating budgets must - by law - be balanced each year (unlike the Federal & Provincial governments who keep deficit spending while bragging they didn’t raise taxes) and cities are not immune to inflation.

So how did we get from the 6.4% estimate down to 3.4%?

$9.6 Million in permanent savings through internal changes at city hall,
$10.8 Million from debt avoidance and servicing savings,
$1.5 Million from Police, $700,000 from Transit, $200,000 from Library, returned from funding they could not utilize this year,
$16 Million in operating surplus from 2024 applied to reduce taxes for both 2026 and 2027,
and several other smaller savings amounts in addition to some provincial changes that decreased municipal expenses.

The first two changes are a permanent $20 million ongoing savings to Londoners and will ease tax pressure in future years too.

How are municipal taxes spent:

How does London stack up in comparison to other Ontario big cities?