B.C. minister's properties surge after he passes foreign buyers tax
B.C.’s finance minister is facing criticism that passing the foreign buyers tax on properties inside Metro Vancouver benefited him personally, given his real estate portfolio that exists just outside the tax’s boundaries.
The one home and six investment properties that belong to Mike de Jong in Abbotsford are worth almost $1 million – a significant investment that rose in value relative to similar properties inside Metro Vancouver, records suggest.
That puts de Jong in a conflict of interest when handling the province’s controversial real estate file, says Duff Conacher of Democracy Watch.
“Given that the finance minister has significant real estate investments, I don’t think he should have been taking part in this,” Conacher said.
“He would have to recuse himself or sell his properties. It has to be one or the other. He can’t have a private interest and take part in decisions about his properties.”
But de Jong tells CTV News he had nothing on his mind except doing his job when he moved and voted for the tax in the B.C. Legislature.
“The decision was based exclusively on the analysis of the data,” he said outside a Liberal caucus meeting.
De Jong remains the finance minister pending the result of B.C.’s extremely close election.
When the 15 per cent tax was applied in August 2016, it only affected Metro Vancouver. There, the real estate market stalled for months before only recently picking up steam.
Instead, buyers flocked to the rest of the province, and even as far away as Toronto, which has seen big gains since last summer.
A CTV News analysis suggests Mike de Jong’s properties rose in value as a result of that dynamic.
According to estimates by the Real Estate Board of Greater Vancouver and the Fraser Valley Real Estate Board, that mix of properties would have gained some three per cent if it was inside Metro Vancouver. But outside the zone where the tax applies, in the Fraser Valley, that same mix of properties would rise 8.7 per cent. The difference in wealth, for de Jong, adds up to about $52,000.
That’s about one third of de Jong’s salary as a minister. He hasn’t sold the properties to realize the wealth gain in cash.
De Jong did disclose the existence of these properties to the legislature’s conflict of interest commissioner, Paul Fraser.
The Conflict of Interest Commissioner’s Office told CTV News that no MLA had recused themselves in the past year.
Conacher said even if this is a conflict of interest, it’s unlikely to be against B.C.’s Member Conflict of Interest Act, because the act has exceptions for members when they are in a group where a large group of other British Columbians would also face such a conflict.
That might apply if the finance minister just had a single home. But a substantial real estate portfolio is another story, he said.
“But for a loophole this would be illegal. But the loophole makes it legal,” Conacher said. “Because of this loophole, cabinet ministers, the premier, MLAs, are allowed to take part in decisions where they can profit from their own decisions. It’s not right, and the loophole should be closed.”