Finance Minister Mike de Jong and Premier Christy Clark take questions on their new foreign buyer tax Monday

B.C. imposes foreign buyer tax on Metro real estate

New 15% tax imposed on non-Canadian buyers in Metro Vancouver, proceeds to a new housing fund

The B.C. government is imposing a new 15 per cent tax on property purchased in Metro Vancouver by non-Canadian citizens or residents.

The tax is to take effect Aug. 2, Finance Minister Mike de Jong told the B.C. legislature Monday at a special session called to deal with the spiralling cost of real estate in parts of urban B.C. The tax does not extend to municipalities outside Metro Vancouver, but could be amended to include those later.

De Jong said revenue from the tax will go into a new provincial fund to provide rental and social housing. Some revenues from a recent increase in B.C.’s property transfer tax on high-end homes may also be directed to the “housing priority initiatives fund,” which is being started up with $75 million in seed money from the provincial treasury.

The new 15 per cent rate on the property transfer tax will be imposed on purchases by foreign nationals and foreign controlled corporations, intended to discourage investment by non-residents.

MORE: Pundits split on whether foreign buyer tax will cool market

In the budget in February, de Jong increased the property transfer tax to three per cent on value of homes more than $2 million, and raised the exemption level to $750,000 for the purchase of new homes, in an effort to encourage new supply.

The property transfer tax continues to apply at one per cent on the first $200,000 of resold homes, and two per cent on value between $200,000 and $2 million. It has produced a windfall of revenues to the province in a hot real estate market in southern urban areas.

Premier Christy Clark said there will be more details in the coming months on how the province will use the new housing fund. She said the 15 per cent foreign buyer tax was chosen after examining similar taxes in Singapore, Hong Kong, London and Sydney.

“There is evidence now that suggests that very wealthy foreign buyers have raised the overall price of housing for British Columbia,” Clark said. “And if we are going to put British Columbians first, and that is what we are intending to do, we need to make sure that we do everything we can to try to keep housing affordable, and to try and make sure those very wealthy foreign buyers find it a little bit harder to buy a house in the Greater Vancouver area.”

NDP leader John Horgan said the province needs to use income tax data to determine whether home buyers are paying tax in Canada, rather than impose rules on foreign nationals.

“Much of the investment that’s happening now in the Lower Mainland is being directed by cash from somewhere else, by people who are already here,” Horgan said.

NDP housing critic David Eby said a foreign investor could avoid the tax by setting up a Canadian company to buy real estate.

The housing legislation introduced Monday also imposes new regulation on the B.C. real estate industry, replacing self-regulation with a new Real Estate Council appointed by the provincial cabinet.

 

Just Posted

Traditional salmon designs brighten Salish Sea Lantern Festival

Children from ȽÁU,WEL,ṈEW̱ tribal school built salmon hats for festival on Sidney waterfront

Speculation tax forces sale of Oak Bay’s ‘Tulip House’

Bob and Jan Fleming selling their retirement home famous for its thousands of tulips

UPDATE: Father on trial for murder describes being ‘tackled’ and ‘stabbed’ in Oak Bay apartment

Oak Bay father takes stand in his defense for December 2017 deaths of young daughters

Province rejects criticism from Saanich councillor over McKenzie Interchange

Transportation ministry says project will ‘significantly lower’ greenhouse gas emissions

New police force in Surrey must avoid VPD, RCMP errors made in Pickton case: Oppal

Boots are scheduled to be on the ground by spring 2021

POLL: Should there be a ban on gas-powered leaf blowers?

We’ve all heard them, and most likely cursed them under our breath.… Continue reading

Greater Victoria wanted list for the week of Aug. 23

Greater Victoria Crime Stoppers is seeking the public’s help in locating the… Continue reading

Striking Western Forest Products workers could lose benefits in September

Union, forest company at odds over Vancouver Island benefit payments as strike enters third month

Conan turns to the Property Brothers for tips on buying Greenland

Jonathan Scott suggests removing glaciers and mountains to bring in ‘more natural light’

Forests minister visits B.C. town rocked by multiple mill shutdowns

A third of Mackenzie turns out for rally, not much to cheer about

Expanded support to help B.C. youth from care attend university still falling short

Inadequate support, limited awareness and eligibility restrictions some of the existing challenges

B.C. music teacher accused of sexual misconduct involving girls

Police believe other victims could be out there after the arrest of Lamar Victor Alviar

Most Read