More than 12,000 homeowners dinged by B.C.'s speculation tax
The provincial government says its speculation and vacancy tax is bringing in $115 million in revenue this year from 12,029 homeowners – including 2,410 B.C. residents.
On Thursday, the Ministry of Finance released updated numbers on the taxes collected for the 2018-19 fiscal year, boasting that the many millions will help the province fund more homes while discouraging speculators from buying up properties and leaving them empty.
Though a couple thousand British Columbians were ensnared in the tax, the majority of people ponying up are foreign owners and satellite families, who make up 4,585 and 3,241 of the total, respectively.
"The speculation and vacancy tax was designed to make sure foreign owners, satellite families and people who use local services without paying income tax in B.C. contribute to the quality of life we all enjoy in this province," Minister Carole James said in a news release.
Another 1,555 people taxed are Canadians who live outside B.C.
According to the province, homes that were "captured by the tax" are on average 46 per cent more expensive than homes that are found in taxable areas but exempt from paying. Taxed homes had an average assessed value of $1.62 million, compared to $1.11 million for exempt homes.
People aren't taxed for their primary residence, or for a property that they rent out to a tenant for at least three months out of the year, and there are several other exemptions people can claim.
More than 99.8 per cent of British Columbians are covered by at least one of the exemptions, according to the government.
Going forward, foreign owners and satellite families are going to be even harder hit by the tax. While everyone was charged the same rate of 0.5 per cent of the property value last year, beginning in 2019, foreign owners and satellite families will be charged two per cent.
The rate for Canadian citizens and permanent residents will remain the same.