Recently, the provincial government announced its plans to implement its new speculation tax. The new tax will ask any property owner who doesn’t pay B.C. income tax to pay 2% of their property value annually starting this year, provided they don’t live in or rent out the home.
Although the tax will only apply to a small percentage of B.C. homeowners, every homeowner will have to prove they are exempt by filling out an online form each year. If the form is not filled out, the tax will automatically be levied, vastly increasing the chances that exempt homeowners will unwillingly pay the extra tax.
Notices have already been sent out, and forms must be filled out by March 31st.
I find the NDP’s rollout of the new tax to be clumsy and unnecessarily expensive.
I think it’s a little absurd that they’re planning to identify the 1% of homeowners through forcing everyone, all 1.6 million homeowners, to spend twenty minutes providing information to prove that they’re exempt. First of all, I believe this information is already provided to the government through the homeowner grant application on property tax notices. They could easily spare us the headache with a few extra lines of code, but they’re spending untold thousands on these mailers and the staff time to process them. The tax is so unpopular to begin with, and then this rollout just adds to the frustration.
The tax is designed to curb foreign speculators who are blamed for artificially inflating our housing market. But I would argue that the fear is overblown.
Very few large investors do property speculation, especially in Langley or anywhere outside of Vancouver. But this tax applies all over the province. The better approach to bringing housing costs down is to reduce the cost to build. These experimental taxes, which have so many unintended consequences and hurt so many honest people, are seriously misguided.
The tax has been called a “non-resident owner tax” that will do little to deter actual foreign speculators. Those who are attempting to game our market will only pay this tax once, while non-resident owners will have to pay every year.
For any questions about the rollout or the terms of the new tax, you can email the provincial government at spectaxinfo@gov.bc.ca.
