For the third consecutive year, Toronto residents are being asked to weigh in on how the city should spend taxpayer dollars, as officials prepare for a looming $1‑billion shortfall in the 2026 budget.
Mayor Olivia Chow and senior city staff are expected to attend the consultations, which give residents a chance to share their priorities on everything from housing to transit. The financial challenges facing the city are significant, with one of the largest pressures tied to a projected $100‑million housing funding gap that Toronto attributes to shortfalls from both the federal and provincial governments.
“Definitely transit is top for me,” said one woman who attended a pre-budget consultation in Toronto on Tuesday.
“Most importantly, security. Housing. I have a list,” another man said.
That gap is expected to fuel debate over property taxes, the city’s primary revenue source for essential services and infrastructure such as transit, emergency response, and community programs.
“There is a structural shortfall that has existed since amalgamation,” said City Councillor Shelley Carroll (Don Valley North). “About half a billion. We’d like to get back to there. But we know that it’s roughly $1 billion.”
Property tax debate looms as city faces $1B shortfall and housing funding gap
Chow has previously warned that Toronto faces a difficult choice: either stop sheltering refugees and asylum seekers or ask residents to shoulder the costs through higher property taxes. She has called on other levels of government to step in, saying neither option is fair.
“Because of [U.S. President Donald] Trump’s tariffs, people have been worried about their jobs,” Chow said on Tuesday night. “They’re feeling uneasy. This is a time for us to hang tight and say, ‘Let’s protect our wallet a bit.'”
The city’s budget chief has already signalled that the 2026 spending plan will be leaner and will likely include a property tax hike.
The first budget committee meeting will be held in January 2026, followed by public presentations. In February 2026, Chow will release the proposed budget, which will then go before City Council for debate and approval.
In addition to this week’s consultation, there are three more in‑person sessions scheduled this month, along with two virtual consultations. For those unable to attend, the city is also offering an online survey.