B.C. speculation tax facing more pushback, a day after tweaks
Just a day after bowing to pressure and tweaking its proposed real estate speculation tax, the British Columbia government is facing more pushback from those who worry about the controversial levy's effects on tourism and new development.
Kelowna Mayor Colin Basran said Tuesday he's still concerned the revisions don't address the issue of flipping and how the tax could discourage new development.
He said many Albertans own properties in the city and that the tax could drive tourism dollars away, citing "the sheer volume of emails I'm getting from people outside the province who say…'We believe we are not welcome in British Columbia and, therefore, we are not coming to your city.'"
The renewed outcry comes a day after the province announced changes narrowing the scope of the speculation tax in an effort to calm the fears of British Columbians who own cottages and vacation properties outside of urban areas.
Finance Minister Carole James told reporters Monday the tax will not apply to homes in smaller, rural communities and most islands.
She said 99 per cent of British Columbians won't pay the tax, including in Whistler, which is considered a resort municipality. The minister said there could be other ways to address housing issues there.
James also announced the tax would only apply in specific locations, including:
- Metro Vancouver Regional District (excluding Bowen Island and parts of Electoral Area A that aren't in the University Endowment Lands)
- The Capital Regional District (excluding the Gulf Islands, Juan de Fuca, Willis Point, East Sooke Park and Matheson Lake Park)
- West Kelowna
- Nanaimo-Lantzville (excluding Newcastle, Protection and smaller islands in Departure Bay)
According to the new rules, those who own homes valued at $400,000 or less won't have to pay.
The province will also make exemptions for special circumstances such as seniors who might be moving out of their home and into a care facility, a death that leaves a home empty or condo owners whose strata councils don't allow units to be rented out.
The tax will start at a base rate of 0.5 per cent of the property's assessed value in 2018. It will climb to 1 per cent for Canadians outside of B.C. and 2 per cent for foreign investors in 2019.
Despite the backlash, the rules surrounding the speculation tax seem unlikely to change in the short term. The tax is expected to become law this fall.
With files from CTV Vancouver's Bhinder Sajan