Report: Foreign buyer tax alone can't cool Toronto's housing market

A new report suggests a foreign buyer tax alone can't solve Toronto's soaring housing prices.
    
The report by Ryerson University's City Building Institute favours a tax on foreign buyers, similar to the one introduced in Vancouver last summer.
   
But today's report suggests it should be implemented in addition to what it calls a "progressive surtax" on expensive homes owned by people who aren't paying income tax, including people with foreign capital.

The report says the surtax would target foreign buyers who don't contribute to the local labour market, as well as wealthy Canadian citizens who have "aggressively evaded taxes."

Figures from the B.C. government show a drop in real estate transactions in the Vancouver area after the provincial government brought in a 15 per cent tax on foreign buyers last August.

However the market had been showing signs of softening prior to the tax after months of scorching sales.